Almost £100 million in business rates was levied on empty properties in the West Midlands in 2011/12, according to a new report.
The Taxpayers’ Alliance, which collected data from Freedom of Information requests, claims councils across the region collected £96,045,909 in empty property rates over the financial year.
An estimate of the amount collected in empty property rates by Birmingham City Council over the last three years, was £20.2 million in 2011-12, £15.3 million in 2010-11 and £15.7 million in 2009-10.
Nationally, commerical property owners were hit by a £1.1 billion tax bombshell in 2011/12, a rise of 19 per cent on 2009-10. The Taxpayers’ Alliance said the tax is having a devastating effect on landlords, with some demolishing properties rather than paying the full rates while unable to find new tenants.
Matthew Sinclair, chief executive of the TaxPayers’ Alliance, said: “It is extremely unfair that property owners are being hit with enormous business rates on properties which are empty, with no rent coming in that they can use to pay the bill.
“There are elderly people who invested in a small commercial or industrial unit in the reasonable expectation that the rent would top up their pension. This new tax is ruining them.
“The rest of us lose out as the mere threat of having to pay rates on empty properties is discouraging people from putting money into new developments or refurbishing existing properties, which is undermining the prospects for economic growth.
“As the true scale of this ugly tax becomes apparent, Ministers cannot keep ignoring their own rhetoric in opposition and leave it in place.”
This is the first time that a figure has been calculated for the amount collected in empty property rates since exemptions for empty commercial and industrial properties were abolished at the 2007 Budget.
Prior to 2007, empty industrial properties were exempt from business rates and empty commercial properties were subject to extensive reliefs and reductions.
Now, apart from a short exemption period and limited reliefs, full business rates are payable on all empty commercial and industrial properties.
Senior members of the Coalition were criticial of the tax on empty property while in opposition, but in Government have failed to address the issue, the Alliance said.