CHANGES in rates bills for rural businesses could have a devastating effect, even bringing some to the brink of closure, it has been suggested this week.

The Valuations Office Agency recently reassessed the rateable value of every commercial property in the country, and the radical changes in the framework for calculating these bills means that many rural businesses have been presented with steep increases.

Machinery dealerships, feed companies, equestrian concerns, and other owners of diversified businesses have been pushed over the threshold of small business rates relief, causing financial turmoil for many of them up and down the country. With the new rates already in effect from April 1, hopes are now focussed on the right to appeal the new valuations.

A survey of over 250 equestrian related businesses, conducted by the British Horse Society, has shown that the average suggested increase in RV for riding schools and livery yards in Scotland is 55%, with some yards facing hikes of more than 150%.

It has been reported that two BHS approved centres in England have already closed their doors because of business rates, and BHS Scotland is concerned that they could see the same north of the border. Aside from the direct impact on businesses, there are wider concerns regarding equine welfare.

BHS Scotland national manager, Helene Mauchlen, said: “The proposed increase in business rates for equestrian businesses is one of the the biggest issues facing the industry. It will have far-reaching consequences on the Scottish equine industry, rural economy and equine welfare as a whole."

It should be noted that the RV is directly correlated to the measurable area of a premise, and when people look at Speaking from Davidson and Robertson Rural property consultants, director Niall Milner explained that, fundamentally, the rateable value is derived from the hypothetical rent that could be charged to a hypothetical tenant to operate the premises.

"The rateable values being suggested often have no basis in reality when the proposed rateable value and resultant rates bill is at risk of putting some members out of business," said Mr Milner.

"The percentage of the RV paid is known as the uniform business rate and is currently around 50%. However, small business rate relief will be available for businesses which only use one property and if the RV is less than £15,000. The relief will be 100% where the RV is £12,000 and on a sliding scale if the RV is between £12,001 and £15,000.

"Following the Chancellor’s autumn statement, rural rate relief is set to increase to a fixed 100% relief for businesses in a rural location with a population of less than 3000," he added.

"Agricultural businesses must remember and query the rates they have been given. They must also ensure that they are receiving any relief that they are due to be getting. Make sure you are getting what you are eligible for at all points!"