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News 16 July 2020

GSOG respond to postponed revaluation of Business Rates

In late June GSOG responded to the UK Government’s decision to postpone its planned business rates revaluation

Business Rates

In June 2020 the Gas Storage Operators Group (GSOG), of which Storengy UK is a member, sent a letter to the Ministry of Housing, Communities and Local Government to request the cessation of the transitional arrangements applicable to business rates. This was in response to the UK Government’s decision to postpone its planned business rates revaluation planned for 1 April 2021 by at least a year.

Without a decision by the Autumn 2020 Budget the existing transitional arrangements, and their punitive downwards phasing provisions, will continue for a 5th year into 2021/22, costing the GB gas storage industry an additional £14m in addition to their Business Rates liabilities.

Gas storage operators have consistently objected to the unfair nature of the 2017 transitional arrangements and sought permission to bring a Judicial Review. In May 2019 Catherine Gras, the CEO of Storengy UK, gave oral evidence to the House of Commons Treasury Select Committee on behalf of GSOG where she outlined the negative impact of the downwards phasing scheme on the gas storage industry. She explained that a transitional scheme is not “transitional” if it does not transition to the correct liability during the life of the rating list. In their subsequent report dated 31 October 2019, the Treasury Committee recognised this, acknowledging that the current arrangements lead to higher costs for business, and went on to recommend that, at the end of a rating list’s life, all business rates liabilities should represent the period’s rating list value, adjusted for inflation.

GSOG has asked that action is taken urgently to implement the Treasury Committee’s recommendation by ending the existing transitional arrangements scheme with effect from 31 March 2021. We at Storengy UK support this request fully and strongly urge the Government to correct the unfairness of the current scheme.  

Business rates must be reviewed timely, ideally every year to reflect trading conditions. Schemes that delay effective application of Rateable Value must be avoided, for businesses like ours to be able to deliver their plans to invest more towards the green energy transition to meet net zero targets. This would provide benefits for both local communities and the UK as a whole, creating jobs for the future and helping our economy to recover after COVID-19.