Restaurateurs face massive hikes in their business rate bills this week, as experts warn that increases in rateable values are likely to be higher than expected.
The Government's new business rates come into effect tomorrow (1 April) and could mean a double whammy for restaurants, as business rates rise above expectations and licensing fees, now based on rateable values, follow suit.
The Federation of Small Businesses has warned that massive increases in property values over the past five years, particularly in the South-east of England, are likely to result in hikes of 12-15%.
But property experts are cautioning that the figures could be even higher. Mike Keane, associate director for leisure at property consultant GL Hearn, warned that he has already seen clients with average rises of 25-30%.
"We work for several large restaurant groups and the figure of 15% as an average rise seems pretty low," he said. "Restaurants definitely seem to have gone up more than the average."
Under the terms of the new Licensing Act, liquor licence fees are based on rateable values, meaning that a rise in business rates will see restaurateurs facing higher liquor licence bills, too.
For more information on rates, go to
www.voa.gov.uk in England and Wales, or
www.saa.gov.uk in Scotland, and look out for Caterer's update next week.
Source: Caterer & Hotelkeeper magazine, 31 March 2005