Prime Minister Gordon Brown has dismissed hopes of a reversal of changes to empty property rate relief, which was introduced on April 1, 2008.
He was responding to a petition of 5,708 signatures from the British Property Federation calling for the reinstatement of empty rates relief.
As of April 1, 2008, property that has been empty for more than three months – or, in the case of industrial property, for more than six months – will no longer receive relief from business rates.
After the initial three or six month rate-free period expires, empty property will be liable for 100% of the basic occupied business rate.
However, Brown said it would not be possible to restore empty rate relief as it would cost the government £950 million.
The Prime Minister said: “The Government decision to introduce the reforms to empty property rate relief, charging 100% rates beyond the initial rate-free periods when properties stand empty, is right for the long term.
It increases the incentive to relet and reuse empty property.
“Reintroducing the previous relief from rates for all empty property would cost £950 million and would remove the incentive to reuse commercial property.”
His office said he had listened to concerns and had restored empty property rate relief for properties with rateable values of up to £15,000, providing relief for up to 70% of all rateable properties.
This represents around £185 million in tax that would have been paid on properties with a rateable value of less than £15,000.