The Local Government Finance Act 1988 (Non-Domestic Rating Multipliers) (England) Order 2014, SI 2014/2, has been made in exercise of the powers conferred by paragraph 5(3) of Schedule 7 to the Local Government Finance Act 1988 (“the 1988 Act”). In relation to England and for the financial year beginning on 1st April 2014 (“2014-15”) the Order specifies an amount which is to be used in the calculation of the non-domestic rating and the small business non-domestic rating multipliers for that year.
Schedule 7 to the 1988 Act establishes a procedure by which the non-domestic rating and the small business non-domestic rating multipliers are calculated for a chargeable financial year. In relation to England and a year at the beginning of which new rating lists are not compiled, the small business non-domestic rating multiplier is calculated in accordance with paragraph 3 of Schedule 7 to the 1988 Act. The non-domestic rating multiplier for the year is then calculated in accordance with paragraph 3A of Schedule 7 to the 1988 Act by reference to that multiplier.
The calculation in paragraph 3 of Schedule 7 to the 1988 Act includes a variable referred to as “B”. Unless an order made by the Treasury provides otherwise, B is the retail prices index for September of the financial year proceeding the year concerned, which in relation to 2014-15 was 251.9. Paragraph 5(3) of Schedule 7 to the Local Government Finance Act 1988 enables the Treasury by order to specify a different amount for B. Where the Treasury exercises this power the amount specified must be less the retail prices index for September of the financial year proceeding the year concerned.
For 2014-15 the Order specifies B as 249 for the purposes of paragraph 3 of Schedule 7 to the 1988 Act. This represents a 2% cap. Otherwise the figure would have been 3.2%.