The Impact of Business Rates rises in the Self-catering Sector

Transcription

1 The Impact of Business Rates rises in the Self-catering Sector

2 This report shows that professional self-caterers (with more than 13 bed-spaces in total) are being hit with increases in their Business Rates bills from 1st April 2017, of between 43% and 71%. These increases cannot be justified in the current climate, whereby the Government itself is recognising that rural and coastal SME s and Micro are under huge pressure and need greater support, as evidenced by the Government launching a Rural Tourism Enquiry.

3 The Impact of Business Rates rises in the Self-catering Sector The South West Tourism Alliance (SWTA) commissioned the following report from The South West Research Company (SWRC) as we have been inundated by owners who have been stunned by the scale of the rises in Business Rates as a result of the 2017 Revaluation. The recent English Self-Catering (EASCO) report showed that English self-catering was worth 3.04 billion and maintained over 20,000 Full Time Equivalent (FTE) jobs. This is before the money that is spent by guests whilst on holiday in the local area. This is major contributor to the vibrancy and employment in the rural economy. The bulk of this money is generated from the wealthy South East and transferred to the poorer rural and coastal regions of the country. What follows is a summary of our findings, drawn both from the report and from the Valuation Offices (VO) own Website. The SWRC study that follows this summary is based on all the hereditaments included in the 2017 self-catering revaluation, and is based upon the VOs own data. Summary Findings The 2017 Business Rates revaluation has seen some of the biggest rises in Business Rates being levied against the self-catering sector. SWTA are particularly concerned with the rises for larger properties, as these will not benefit from the Governments initiative that small with a Rateable Value (RV) of under 12,000 will not actually pay Business Rates. As can be seen from the extract from page 10 of the Research Study, rises for the larger properties are huge. No of Bedspaces No of Businesses Average RV/Bedspace Increase on 2010 RV 1 to 4 20, % 5 to 8 12, % 9 to 12 2, % 13 to 20 1, % 21 to ,043 58% ,269 71% These rises will come into effect from April 2017 with paying these increases immediately thereafter. The column marked in red show how the larger are baering the brunt. These are still small that SWTA is referring to here. A selfcatering business with four holiday cottages, with each sleeping six persons, falls into the band above and will have an increase of 58% levied against them. Their turnover is probably in the region of 80, ,000 dependent upon the location and. A self-catering business with ten cottages sleeping six persons, falls into the 50+ band and will have a 71% increase levied against them. The likely turnover of this business will be from 200,000 to 300,000 depending upon location and. On they will employ over one Full Time employee (FTE) each and a myriad of occasional labour. The affected are all Micro by Government definition.

4 These larger are commonly referred to as complexes. They will offer considerably more facilities than stand-alone holiday properties, which could include, swimming pools, tennis courts, extensive play facilities all of which increase their running costs. They will also be employing higher than numbers of both FTEs and occasional staff. These rises will hit this sector extremely hard and may push many to sale or closure, as these are not hugely profitable. These complexes are still SMEs and should be supported by the Government as such. A major reason why these are less profitable than the casual observer might imagine is the effect of VAT. Once past the threshold VAT has to be charged at 20%. The very great bulk of the self-catering sector falls below both the VAT threshold and the new Business Rates threshold of an RV of 12,000 or less. This creates a vortex of tax for above these thresholds. Bearing in mind that pricing is competitive, and that like for like properties are let for approximately the same rate the following occurs: Weekly letting rental VAT Business Rates Net to owner Cottage A Cottage B Where does the 10% of letting value come from applied as Business Rates? It comes from the VO website, where the chart below and information are published. Five Letting Units or more The VOA has sought to establish the reasonable turnover of a property as at 01 April 2015 and applied to this turnover the following percentage figures: These three categorization relates to only, A = high, B = medium, C = Low, no allowance made for location. This translates as A = 5*, B =4* and C =3* as there are no one or two star complexes. This means for a mid-range property with five letting units or more the RV is simply 20% of turnover. With a Government Multiplier applied of.49 p in the Pound, this is adding a DIRECT TAX on bookings of 10%, payable monthly, quite probably in advance of getting the actual bookings. This method of valuation is clearly wrong, it is not basing the RV on profitability, ability to pay, investment in the business, features offered, running costs etc. This methodology will result in an increased number of appeals, which is likely to cost the owners dear, see note on Appeals below. Attempts at communication with the Valuation Office (VO) is patchy at best with many querying their revaluation being told they have to wait four months before their comments can even be looked at. By that time the RVs are firmed up in the list and to challenge them the owner will have to go through an inordinately long appeal process, whilst at the same time paying the increased Business Rates. Owners have set their prices for 2017 and in many cases for 2018 also. There is little if any room for manoeuvre as prices have to be at a competitive level, so owners will have to absorb these additional costs themselves. This will have the obvious knock on effect of reducing profitability, (and Corporation Tax) which will mean less money on staffing (reduction in employment) and less money in investment. Ultimately this will impact on the and service levels of the offer. The missing properties and why? Category % Applied A 17.5% B 20.0% C 22.5% SWTA believes that the current ratings list for self-catering properties misses almost half the properties currently available under FHL rules in England and Wales. The rating list has not increased substantially since the 2010 list despite an explosion of availability in this sector caused by the changes in rules on Furnished Holiday Lettings rules introduced in 2011/12.

5 The listing has also missed the tens of thousands of properties that are now let under what should be FHL rules in the sharing economy. SWTA is in the process of providing a count of the rural and coastal hereditaments, and where these properties are to the VO. The current rating list has just over 40,000, and we believe, excluding the sharing economy, that this will be nearer 80,000. This means that a very small proportion of the sector has been re-valued and a very small proportion of that is paying hugely increased rates. How has the VO missed so many properties? The background to this is as follows. Non-Business Rates Obligations for Holiday Accommodation Owners Primary Legislation Sections 41 and 52 of the Local Government Finance Act 1988 require local authority and central valuation officers to Compile, and then maintain, lists for the authority (to be called local non-domestic rating lists and central non-domestic rating lists) and Before a list is compiled the valuation officer must take such steps as are reasonably practicable to ensure that it is accurately compiled Secondary Legislation Regulations are contained within the Non-Domestic Rating (Alteration of Lists and Appeals) (England) Regulations 2009 SI No This provides powers for notices to be served by the Valuation Office Agency (VAO) - see reg 22 in particular. The information at self-catering-and-holiday-let- accommodation is relatively brief and contains the following about self-catering accommodation: 8. Self-catering and holiday let accommodation If your property is in England and available to let for 140 days or more per year, it will be rated as a self- catering property and valued for business rates. If your property is in Wales and both available to let for 140 days or more per year and actually let for 70 days, it will be rated as a selfcatering property and valued for business rates. The Valuation Office Agency (VOA) works out the business rate based on the property type, size and location, and how many people can sleep in it. Single bed space is the term used to describe how many people can sleep in the property. So where is the problem? It is common in many areas of the tax system for the taxpayer to be under a duty to inform the tax authorities about their circumstances and changes to those circumstances. Such a duty does not exist in business rates. Some stakeholders have suggested that the business rates system would benefit from such a duty. The government would like to understand how such a duty could be applied in practice So, in short, the Local Authorities are supposed to supply the information on FHLs (Properties let as holiday cottages as above) to the VO and the VO is supposed to also carry out research to compile the list. The owner has no LEGAL obligation to declare the property. The result of all this? The owners do not have to declare the properties obligations under the rules above. The Local Authorities have no incentive to do this, if they send a property s details to the VO, they lose the Council Tax revenue. They are hardly likely to be fully resourcing a function that reduces their income. The VO have been told many times that they are missing a

6 huge proportion of the stock, which they deny. This has clearly not been a priority for the VO as with our limited resources we can find these properties. SWTA will now provide a list of where the VO can find them. Appeals process Business Rates the new Check/Challenge/Appeal approach The Government has made the process of appealing against a rating assessment much more complicated and the timescales proposed by the VO are far too long. After 01 April 2017 (when the new valuations go live for billing purposes), the process for appealing the revaluation rates has changed, and it will now be a three-stage process. Check All ratepayers wishing to appeal their valuation will be required to submit an initial online check with the Valuation Office Agency (VOA). The check stage is essential a fact finding and checking exercise in which facts concerning the property are agreed between the Valuation Office Agency (VOA) and the ratepayer. The VOA has been given 12 months to deal with the check stage. Challenge If the rateable value is not agreed at this stage the ratepayer has four months to submit a formal challenge. The VOA has 18 months to consider the challenge. The ratepayer will be required to set out: a) grounds for the challenge b) substantive reasons for the challenge, backed by supporting evidence, and c) an alternative valuation which is supported by the evidence provided Appeal If the matter is still not agreed ratepayers will have up to 4 months following the issue of the VOA s decision notice to make a formal appeal to the Valuation Tribunal for which a fee will become payable, refundable if successful. The hearing fee is between 150 to 300. Only the evidence submitted at the Challenge stage is permitted to be presented to the tribunal. During this whole process the ratepayer has to continue to pay the increased RV. Costs of appealing The costs of appealing both in terms of time and money can be huge. If an owner wishes to launch an appeal they need bear in mind that the very great majority of Valuers work on a no win no fee basis. If the Valuer believes there is a reasonable likelihood of success and they take on the owners case, the owner commits to pay them 20-25% of the total saving achieved over the next 5 years, which in effect means that even if they win 100% and reduce the valuation back to where it was, they will effectively have had an increase of 20-25%. SWTA does not recommend that owners try to run an appeal on their own, despite the previous paragraph. The reason that the VO can claim they win the majority of appeals is that they are made in the main by individual making the appeal in their own right. They have no access to collective evidence; they have no idea of how the appeal system works, and in short they are completely outmaneuvered by the VO. Owners now also get fined for making a spurious appeal (i.e. for not understanding the system or for not submitting sufficient evidence). In contrast, the success ratio of appeals carried out by reputable companies is very high, because they know the system, and they will only take on cases with a high likelihood of success. In short, owners having a big increase, will unfortunately end up paying one way or another.

7 Conclusion These very large increases in business rates for self-catering is directly counter to Government policies aimed at supporting the economies of rural and seaside communities. It is particularly hard to comprehend that his happened at the same time as the Government launches a Rural Tourism Enquiry. This Enquiry has been launched due to the increasing pressure on the rural and coastal sector from many sides. These already suffer from a paucity of rural broadband, as important for their as any other, expensive waste collections costs and considerably higher casual labour costs than London. They have no way of passing on these costs in an ever more competitive online marketplace. As stated earlier, the recent English Self-Catering (EASCO) report showed that English self-catering was worth 3.04 billion and maintained over 20,000 FTE jobs. This is before the money that is spent by guests whilst on holiday in the local area. This is major contributor to the vibrancy and employment in the rural economy. The bulk of this money is moved from the wealthy South East to the poorer regions of the country. It is essential that these increases are re-considered, SWTA has only quoted s, but some rises will put into severe financial difficulty and may even cause failure. The protection that the VO has afforded itself with a tortuously long and drawn out appeals process, whilst the owner still has to pay the new revaluation, is indicative of an indefensible system of ratings. January 2017 Alistair Handyside Chairman South West Tourism Alliance info@swtourismalliance.org.uk

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9 Self Catering Rateable Value Changes 2017 An overview of the changes in rateable values for self catering properties in England and Wales Published by The South West Research Company Ltd January 2017

10 Contents Page Key findings 3 Introduction and methodology 5 Interpretation notes 7 England 8 England (Excl. London) 12 Wales 16 All areas Key measures and changes comparisons (2010 to 2017) 20 English regions Regional breakdowns 24

11 Key findings New revaluations have now been issued for self catering properties in England and Wales which come into effect in April The South West Tourism Alliance (SWTA) wished to gain a better understanding of the financial implications to caused by the new 2017 revaluation and commissioned The South West Research Company (TSWRC) to provide an analysis of the VOA self-catering database. This report provides an overview of the information contained within those databases at both a national and regional level for England and at a national level for Wales. Approximately a third of self catering in England have a Value per Bedspace (VPB) of between 700 and 1,000 in The VPB across England for 2017 is 850 compared to an VPB of 608 in 2010, an change of 242 per bedspace or a percentage increase of 45%. When London is excluded from the England analysis the results are very similar to those for England overall. A third of self catering have a Value per Bedspace (VPB) of between 700 and 1,000 in The VPB for 2017 is 824 compared to an VPB of 597 in 2010, an change of 226 per bedspace or a percentage increase of 45%. 64% of self catering in Wales have a Value per Bedspace (VPB) of between 600 and 900 in The VPB across Wales for 2017 is 675 compared to an VPB of 446 in 2010, an change of 229 per bedspace or a percentage increase of 52%. At a national level the highest VBP for both 2010 and 2017 was in England which was 17,500 in 2010 and is 28,000 for 2017 compared to a maximum VPB of 5,000 in 2010 and 6,000 in 2017 in Wales. When London is excluded form the national data the highest 2017 VPB figure is 20,000. Amongst the English regions the North West had the highest VPB in 2010 ( 17,500) and the highest VPB outside of London in 2017 ( 20,000). By way of comparison the lowest VPB in 2010 and 2017 was in the North East ( 875 and 1,500 respectively). 3

12 Key findings Amongst the English regions London had the highest VPB in both 2010 and 2017 ( 2,933 and 6,620 respectively). Excluding London the highest VPB in both analysis years was in the South East ( 704 in 2010 and 919 in 2017). The lowest VPB in 2010 was in the East Midlands ( 381) and the lowest 2017 in the East of England and Yorkshire ( 733 in both areas). Amongst the English regions London saw the highest percentage change per bedspace between 2010 and 2017 (125%). Excluding London the highest percentage change was in the North East (117%) with the lowest in the South West (25%). The report provides a breakdown of the most common rateable values present in each of the comparison areas in 2017 (top five) and the proportion of covered by those values. This provides an indication of the range of different values (VPB) present in each of the areas. Amongst the English regions the value of the top five most common VPB s vary between the regions. In terms of the proportions of being charged the top 5 most common VPB s in their respective areas these also vary considerably as shown below; London 98% East Midlands 80% East of England 74% West Midlands 72% North East 62% North West 57% Yorkshire 56% South East 49% South West 35% 4

13 Introduction and methodology The Valuation Office Agency (VOA) assesses the rateable value of all business and non-domestic property in England and Wales and compiles them in rating lists. The rateable value is a key factor in the calculation of business rates liability and is a professional assessment of the annual rent a property would fetch on a set valuation date. Usually, every five years, the VOA carries out a revaluation of all rateable values in England and Wales. The most recent revaluation came into effect in England and Wales on 1 April 2010 based on rateable values from 1 April The 2015 revaluation was postponed to 2017and new revaluations have now been issued for England and Wales which come into effect in April For self catering properties the VOA works out the business rate based largely on the property type, size and location and how many people can sleep in it. However, it is our understanding that there are other factors unique to an individual business which can also be used in the calculation. To our knowledge there is no detailed information available on the processes applied and calculations used for self catering properties. The South West Tourism Alliance (SWTA) wished to gain a better understanding of the financial implications to caused by the new 2017 revaluation and commissioned The South West Research Company (TSWRC) to provide an analysis of the VOA s self catering list. This report provides an overview of the information contained within those databases at both a national and regional level for England and at a national level for Wales. To produce the analysis contained within this report a number of measures and checks have been made to try and ensure that the data presented is as accurate as possible although no assurances can be given on the robustness of the initial data provided for this study. The analysis provided is for business entries contained within both the VOA 2010 and 2017 databases for which a unique match could be made between both years. Any duplicates were removed and the analysis is also only for which had a matching number of bedspaces in both 2010 and This final step was taken to reduce the likelihood of rogue figures within the data which were caused by changes to the business size or by possible errors in the construction of the database. The data used for those entries meeting these requirements has otherwise been left unchanged and whilst some figures appear to be large TSWRC are not in the position to question the data and do not have a sufficient knowledge of the calculations used. 5

14 Introduction and methodology The 2017 VOA database provided contained a total of 44,564 entries of which a unique match was made to the 2010 database for 40,959 entries (92%) of the whole database which met the criteria required. 92% of were based in England and 8% were based in Wales. Details of the sample for each of the English regions is provided in the summary pages for each area. In addition to the VOA data VisitEngland data has also been attached where practical and possible providing details of that were signed up to the National Quality Assurance Scheme (NAQAS) to allow for a further analysis of revaluation data by NAQAS grading where samples allow. This was only possible for a proportion of the VisitEngland database where unique postcode values were available and matched in both databases. This equated to approximately 25% of the VisitEngland database being matched (1,702 records) providing a robust sample for analysis overall and good sample sizes across the majority of analysis areas. This analysis breakdown is referred to as the VE Quality Grouping throughout the report. 6

15 Interpretation notes This report provides data in a similar format throughout the report where possible and provides data for a number of key comparable measures across all of the analysis areas. Whilst we have tried to highlight key measures, comparisons and differentials there are many different points and comparisons that could be singled out and it is likely that many users of this report will have the most interest in their own particular accommodation type, area etc. As a result we have not attempted to over complicate this report with large amounts of text, instead just highlight what we would consider to be the likely general points of interest and the highest and lowest figures for each analysis area for ease of use where appropriate. Key points to note with interpretation/terms used; VPB - Value per bedspace Top five rateable VPB The five most common rateable values within the analysis area. Change overview Summary of overall change for rateable VPB in the analysis area. of database entries The count of entries in the analysis database, not the original Valuation Office database. Sum of bedspaces The sum of the bedspaces for those in the analysis database, not the original Valuation Office database. Two highest figures (where possible). Two lowest figures (where possible). VE VisitEngland 7

16 England 2010 to 2017 changes key points 88% of self catering in England have had their rateable value increased in 2017 compared to 2010, 6% stayed the same as in 2010 and 6% saw their rateable value decrease. Approximately a third of have a VPB of between 700 and 1,000 in The maximum VPB has increased from 17,500 in 2010 to 28,000 in The VPB across England for 2017 is 850 compared to an VPB of 608 in 2010, an change of 242 per bedspace. There is an increase of 45% per bedspace across self catering in England in 2017 compared to When analysed by size (numbers of bedspaces) all bedspace groups have increases compared to 2010 with the largest (50+ bedspaces) seeing the largest increases (71%) and the smaller (1 to 4 and 50 to 8 bedspaces) seeing the smallest increases (39% in each case). Amongst VE graded those with a mix of gradings have the largest increases compared to 2010 (50%). 8

17 England Key measures and changes (2010 to 2017) Top Five Rateable VPB % % 1, % % % % Total 33.11% Change overview Increased - 88% Stayed the same - 6% Decreased - 6% England Key Measures of database entries 37,367 Sum of bedspaces ,696 Sum of bedspaces ,696 Maximum VPB ,500 Maximum VPB ,000 Minimum VPB Minimum VPB Range VPB ,488 Range VPB ,000 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 14,500-1, % -100% 45% 9

18 England Breakdown by size (2010 to 2017) 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 20, % 39% 5 to 8 12, % 39% 9 to 12 2, % 43% 13 to 20 1, % 43% 21 to ,043 23% 58% ,269 49% 71% 2010 Bedspace VPB from 2010 all 1 to 4 20, % 5 to 8 12, % 9 to 12 2, % 13 to 20 1, % 21 to % % When analysed by size (numbers of bedspaces) all bedspace groups have increases compared to 2010 with the largest (50+ bedspaces) seeing the largest increases (71%) and the smaller (1 to 4 and 5 to 8 bedspaces) seeing the smallest increases (39% in each case). The scale of increase between 2017 and 2010 decreases as the number of bedspaces decreases. Compared to the all business VPB for 2017 with 50+ bedspaces, 21 to 50 bedspaces and 1 to 4 bedspaces all have increased VPB above the all VPB cost (49%, 23% and 8% respectively). 10

19 England Breakdown by grading (2010 to 2017) 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 47% Four star 1, % 41% Three star % 45% Two star % 27% Mix % 50% 2010 VE VPB from 2010 all Five star % Four star 1, % Three star % Two star % Mix % Amongst VE graded those with a mix of gradings have the largest increases compared to 2010 (50%). After this the highest VPB increase is evident for five star graded (47%) with the scale of increase decreasing as the grading gets lower resulting in two star having the lowest increase (27%) compared to 2010 at the national level. 11

20 England (Excl. London) 2010 to 2017 changes key points Excluding London, 88% of self catering in England have had their rateable value increased in 2017 compared to 2010, 6% stayed the same as in 2010 and 6% saw their rateable value decrease. Approximately a third of have a VPB of between 700 and 1,000 in The maximum VPB has increased from 17,500 in 2010 to 20,000 in The VPB across England (Excluding London) for 2017 is 824 compared to an VPB of 597 in 2010, an change of 226 per bedspace. There is an increase of 45% per bedspace across self catering in England in 2017 compared to When analysed by size (numbers of bedspaces) all bedspace groups have increases compared to The largest (50+ bedspaces) have the smallest increase (26%) with all other s being relatively closely grouped in terms of the size of their change with increases ranging from 37% to 42%. Amongst VE graded those with a mix of gradings have the largest increases compared to 2010 (50%). 12

21 England (Excl. London) Key measures and changes (2010 to 2017) Top Five Rateable VPB % % 1, % % % % Total 33.25% Change overview Increased - 88% Stayed the same - 6% Decreased - 6% England (Excl. London) Key Measures of database entries 37,198 Sum of bedspaces ,648 Sum of bedspaces ,648 Maximum VPB ,500 Maximum VPB ,000 Minimum VPB Minimum VPB Range VPB ,488 Range VPB ,000 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 5,625-1, % -100% 45% 13

22 England (Excl. London) Breakdown by size (2010 to 2017) 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 20, % 37% 5 to 8 12, % 39% 9 to 12 2, % 42% 13 to 20 1, % 41% 21 to % 37% % 26% 2010 Bedspace VPB from 2010 all 1 to 4 20, % 5 to 8 12, % 9 to 12 2, % 13 to 20 1, % 21 to % % When analysed by size (numbers of bedspaces) all bedspace groups have increases compared to The largest (50+ bedspaces) have the smallest increase (26%) with all other s being relatively closely grouped in terms of the size of their change with increases ranging from 37% to 42%. Compared to the VPB cost for all in 2017 the only to have an above VPB is the 1 to 4 bedspaces category (8%). All other s are below the all VPB cost in 2017 with those with 50+ bedspaces being 29% below the cost ( 581 VPB for 50+ compared to 824 VPB for all ). 14

23 England (Excl. London) Breakdown by grading (2010 to 2017) 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 47% Four star 1, % 41% Three star % 45% Two star % 27% Mix % 50% 2010 VE VPB from 2010 all Five star % Four star 1, % Three star % Two star % Mix % Amongst VE graded those with a mix of gradings have the largest increases compared to 2010 (50%). After this the highest VPB increase is evident for five star graded (47%) with the scale of increase decreasing as the grading gets lower resulting in two star having the lowest increase (27%) compared to 2010 at the national level. 15

24 Wales 2010 to 2017 changes key points 98% of self catering in Wales have had their rateable value increased in 2017 compared to 2010 and 1% saw their rateable value decrease. 64% of have a VPB of between 600 and 900 in The maximum VPB has increased from 5,00 in 2010 to 6,000 in The VPB across Wales for 2017 is 675 compared to an VPB of 446 in 2010, an change of 229 per bedspace. There is an increase of 52% per bedspace across self catering in Wales in 2017 compared to When analysed by size (numbers of bedspaces) all groups have increases compared to 2010 with the 1 to 4 bedspaces group having the largest (59%), with 21 to 50 bedspaces having the next largest increase (54%). Businesses with 5 to 8, 9 to 12 and 13 to 20 bedspaces have relatively similar levels of increase (45%, 43% and 48% respectively) with with 50+ bedspaces having the smallest increase of 26%. 16

25 Wales Key measures and changes (2010 to 2017) Top Five Rateable VPB % % % % % % Total 63.47% Change overview Increased - 98% Stayed the same - 0% Decreased - 1% Wales Key Measures of database entries 3,592 Sum of bedspaces ,608 Sum of bedspaces ,608 Maximum VPB ,000 Maximum VPB ,000 Minimum VPB Minimum VPB Range VPB ,987 Range VPB ,983 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 2, % -43% 52% 17

26 Wales Breakdown by size (2010 to 2017) 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 1, % 59% 5 to 8 1, % 45% 9 to % 43% 13 to % 48% 21 to % 54% ,145 70% 26% 2010 Bedspace VPB from 2010 all 1 to 4 1, % 5 to 8 1, % 9 to % 13 to % 21 to % % When analysed by size (numbers of bedspaces) all groups have increases compared to 2010 with the 1 to 4 bedspaces group having the largest (59%), with 21 to 50 bedspaces having the next largest increase (54%). Businesses with 5 to 8, 9 to 12 and 13 to 20 bedspaces have relatively similar levels of increase (45%, 43% and 48% respectively) with with 50+ bedspaces having the smallest increase of 26%. Compared to the VPB cost for all in 2017 the only s to have an above VPB are the 1 to 4 bedspaces category (12%) and 50+ bedspaces (70%). All other s are below the all VPB cost in 2017 with those with 21 to 50 bedspaces being 15% below the cost ( 576 VPB for 21 to 50 compared to 675 VPB for all ). 18

27 Wales Breakdown by grading (2010 to 2017) 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 20% Four star % 43% Three star 0 0 NA NA Two star 0 0 NA NA Mix 0 0 NA NA 2010 VE VPB from 2010 all Five star % Four star % Three star 0 0 NA Two star 0 0 NA Mix 0 0 NA Meaningful analysis amongst graded in Wales is not possible due to the small sample size. 19

28 All areas Key measures and changes comparisons (2010 to 2017) Apart from providing key figures for the changes in rateable value at a national level this report also provides a breakdown for each English region. Summary data for each region individually can be found from page 23 in this report but this section looks at the key differences when comparing all of the areas covered in this report (national and English regions). Some of the key differences between the areas are; At a national level the highest VBP for both 2010 and 2017 was in England which was 17,500 in 2010 and is 28,000 for 2017 compared to a maximum VPB of 5,000 in 2010 and 6,000 in 2017 in Wales. When London is excluded form the national data the highest 2017 VPB figure is 20,000. Amongst the English regions the North West had the highest VPB in 2010 ( 17,500) and the highest VPB outside of London in 2017 ( 20,000). By way of comparison the lowest VPB in 2010 and 2017 was in the North East ( 875 and 1,500 respectively). The VPB was highest in England in both 2010 and 2017 ( 608 and 850 respectively) compared to Wales ( 446 in 2010 and 675 in 2017). Amongst the English regions London had the highest VPB in both 2010 and 2017 ( 2,933 and 6,620 respectively). Excluding London the highest VPB in both analysis years was in the South East ( 704 in 2010 and 919 in 2017). The lowest VPB in 2010 was in the East Midlands ( 381) and the lowest 2017 in the East of England and Yorkshire ( 733 in both areas). In terms of the percentage change per bedspace between 2010 and 2017 the increase for both England and England (excluding London) was 45% compared to a 52% increase in Wales. Amongst the English regions London saw the highest percentage change per bedspace between 2010 and 2017 (125%). Excluding London the highest percentage change was in the North East (117%) with the lowest in the South West (25%). 20

29 All areas Key measures and changes comparisons (2010 to 2017) Measures Eng Eng (Excl. Lon) Wales East EM Lon NE NW SE SW WM Yorks Maximum VPB ,500 17,500 5,000 1,750 1,000 13, ,500 2,500 3,625 1,300 1,750 Maximum VPB ,000 20,000 6,000 4,700 1,600 28,000 1,500 20,000 4,150 9,000 3,250 4,700 Average VPB , Average VPB , Average change per bedspace , Average % change per bedspace 45% 45% 52% 42% 95% 125% 117% 38% 33% 25% 98% 42% 21

30 All areas Most common rateable values by region 2017 As previously mentioned in this report the details available regarding the methodology used to calculate the rate valuations suggest that a number of factors are taken into consideration in the calculations including details personal to the business. The following page looks at the most common rateable values present in each of the comparison areas in 2017 and the proportion of covered by those values. This provides an indication of the range of different values (VPB) present in each of the areas. At a national level the analysis VPB s for England including and excluding London are very similar with the most common (top five) VPB s being between 700 and 1,000 per bedspace and these values being applicable to around a third of self catering. In Wales the top five most common VPB s range between 550 and 900, however, the five charges are applicable to approximately 64% of self catering in the country. Amongst the English regions the top five VPB s vary between the regions as shown in the table overleaf. In terms of the proportions of being charged the top 5 most common VPB s in their respective areas these also vary considerably as shown below; London 98% East Midlands 80% East of England 74% West Midlands 72% North East 62% North West 57% Yorkshire 56% South East 49% South West 35% 22

31 All areas Key measures and changes comparisons (2010 to 2017) Top five VPB 2017 Eng % Eng (Excl. Lon) % Wales % East % EM % Lon % % % % 1, % 1, % 6, % % % % % % 8, % 3 1, % 1, % % % % 1, % % % % % % % % % % % % 18, % Total % 33.11% 33.25% 63.47% 73.57% 79.93% 98.22% Top five VPB 2017 NE % NW % SE % SW % WM % Yorks % % % % % % % % % 1, % % % % % % % % 1, % 1, % % 1, % % % % % 5 1, % 1, % % % % 1, % Total % 62.03% 56.68% 48.69% 35.43% 71.95% 55.82% 23

32 English regions Regional breakdowns The following pages provide a two page breakdown for each of the English regions in a similar format to that already used within this report and the highest and lowest values highlighted for ease of reference where appropriate. 24

33 East of England Key measures and changes (2010 to 2017) Top Five Rateable VPB , % % % % % % Total 73.57% Change overview Increased - 82% Stayed the same - 17% Decreased - 1% East of England Key Measures of database entries 4,783 Sum of bedspaces ,284 Sum of bedspaces ,284 Maximum VPB ,750 Maximum VPB ,700 Minimum VPB Minimum VPB Range VPB ,730 Range VPB ,673 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 2, % -73% 42% 25

34 East of England Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 2, % 45% 5 to 8 1, % 51% 9 to % 73% 13 to % 76% 21 to % 67% % 35% 2010 Bedspace VPB from 2010 all 1 to 4 2, % 5 to 8 1, % 9 to % 13 to % 21 to % % 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 56% Four star % 50% Three star % 39% Two star % 69% Mix % 37% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star % Mix % 26

35 East Midlands Key measures and changes (2010 to 2017) Top Five Rateable VPB , % % % % % % Total 79.93% Change overview Increased - 82% Stayed the same - 18% Decreased - 0% East Midlands Key Measures of database entries 2,063 Sum of bedspaces ,392 Sum of bedspaces ,392 Maximum VPB ,000 Maximum VPB ,600 Minimum VPB Minimum VPB Range VPB Range VPB ,583 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 1, % -29% 95% 27

36 East Midlands Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 1, % 94% 5 to % 85% 9 to % 114% 13 to % 150% 21 to ,429 91% 291% % 137% 2010 Bedspace VPB from 2010 all 1 to 4 1, % 5 to % 9 to % 13 to % 21 to % % 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 130% Four star % 106% Three star % 118% Two star 0 0 NA NA Mix 4 1,013 35% 154% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star 0 0 NA Mix % 28

37 London Key measures and changes (2010 to 2017) Top Five Rateable VPB , % 8, % 1, % % 18, % % Total 98.22% Change overview Increased - 100% Stayed the same - 0% Decreased - 0% London Key Measures of database entries 169 Sum of bedspaces ,049 Sum of bedspaces ,049 Maximum VPB ,500 Maximum VPB ,000 Minimum VPB Minimum VPB Range VPB ,990 Range VPB ,300 Average VPB ,933 Average VPB ,620 Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 14,500-3, % - 125% 29

38 London Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to ,646 0% 126% 5 to 8 1 1,875-72% 56% 9 to ,200-6% 125% 13 to ,560-1% 126% 21 to ,529-1% 126% ,000 6% 127% 2010 Bedspace VPB from 2010 all 1 to ,946 0% 5 to 8 1 1,200-59% 9 to ,750-6% 13 to ,900-1% 21 to ,884-2% ,083 5% 2017 VE VPB Diff from all 2017 Difference from 2010 Five star 0 0 NA NA Four star 0 0 NA NA Three star 0 0 NA NA Two star 0 0 NA NA Mix 0 0 NA NA 2010 VE VPB from 2010 all Five star 0 NA NA Four star 0 NA NA Three star 0 NA NA Two star 0 NA NA Mix 0 NA NA 30

39 North East Key measures and changes (2010 to 2017) Top Five Rateable VPB % % % % 1, % % Total 62.03% Change overview Increased - 100% Stayed the same - 0% Decreased - 0% North East Key Measures of database entries 1,854 Sum of bedspaces ,225 Sum of bedspaces ,225 Maximum VPB Maximum VPB ,500 Minimum VPB Minimum VPB Range VPB Range VPB ,486 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 1, % -7% 117% 31

40 North East Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 1, % 110% 5 to % 114% 9 to % 129% 13 to % 108% 21 to % 127% % 138% 2010 Bedspace VPB from 2010 all 1 to 4 1, % 5 to % 9 to % 13 to % 21 to % % 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 122% Four star % 103% Three star % 101% Two star 0 0 NA NA Mix % 86% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star 0 0 NA Mix % 32

41 North West Key measures and changes (2010 to 2017) Top Five Rateable VPB % % % 1, % 1, % % Total 56.68% Change overview Increased - 91% Stayed the same - 2% Decreased - 7% North West Key Measures of database entries 4,257 Sum of bedspaces ,441 Sum of bedspaces ,441 Maximum VPB ,500 Maximum VPB ,000 Minimum VPB Minimum VPB Range VPB ,486 Range VPB ,000 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 2,500-1, % -100% 38% 33

42 North West Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 2,093 1,014 14% 33% 5 to 8 1, % 42% 9 to % 30% 13 to % 20% 21 to % 20% ,080 21% 17% 2010 Bedspace VPB from 2010 all 1 to 4 2, % 5 to 8 1, % 9 to % 13 to % 21 to % % 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 33% Four star % 36% Three star % 39% Two star % 19% Mix % 39% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star % Mix % 34

43 South East Key measures and changes (2010 to 2017) Top Five Rateable VPB % 1, % % % % % Total 48.69% Change overview Increased - 85% Stayed the same - 4% Decreased - 11% South East Key Measures of database entries 3,101 Sum of bedspaces ,697 Sum of bedspaces ,697 Maximum VPB ,500 Maximum VPB ,150 Minimum VPB Minimum VPB Range VPB ,475 Range VPB ,122 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 2,363-1, % -54% 33% 35

44 South East Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 1, % 36% 5 to % 24% 9 to % 17% 13 to % 19% 21 to % 3% % 4% 2010 Bedspace VPB from 2010 all 1 to 4 1, % 5 to % 9 to % 13 to % 21 to % % 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 23% Four star % 24% Three star % 44% Two star 1 1,000 9% -9% Mix % 15% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star 1 1,100 56% Mix % 36

45 South West Key measures and changes (2010 to 2017) Top Five Rateable VPB % % % % % % Total 35.43% Change overview Increased - 85% Stayed the same - 7% Decreased - 9% South West Key Measures of database entries 15,449 Sum of bedspaces ,957 Sum of bedspaces ,957 Maximum VPB ,625 Maximum VPB ,000 Minimum VPB Minimum VPB Range VPB ,613 Range VPB ,000 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 5, % -100% 25% 37

46 South West Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 7, % 18% 5 to 8 5, % 25% 9 to % 25% 13 to % 24% 21 to % 22% % 29% 2010 Bedspace VPB from 2010 all 1 to 4 7, % 5 to 8 5, % 9 to % 13 to % 21 to % % 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 25% Four star % 22% Three star % 24% Two star % 2% Mix % 37% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star % Mix % 38

47 West Midlands Key measures and changes (2010 to 2017) Top Five Rateable VPB % % 1, % % % % Total 71.95% Change overview Increased - 99% Stayed the same - 0% Decreased - 1% West Midlands Key Measures of database entries 1,583 Sum of bedspaces ,761 Sum of bedspaces ,761 Maximum VPB ,300 Maximum VPB ,250 Minimum VPB Minimum VPB Range VPB ,260 Range VPB ,198 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 2, % -50% 98% 39

48 West Midlands Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to % 89% 5 to % 75% 9 to % 106% 13 to % 101% 21 to % 141% NA NA 2010 Bedspace VPB from 2010 all 1 to % 5 to % 9 to % 13 to % 21 to % NA 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 81% Four star % 96% Three star % 87% Two star 0 0 NA NA Mix % 129% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star 0 0 NA Mix % 40

49 Yorkshire Key measures and changes (2010 to 2017) Top Five Rateable VPB % % 1, % % 1, % % Total 55.82% Change overview Increased - 99% Stayed the same - 0% Decreased - 1% Yorkshire Key Measures of database entries 4,783 Sum of bedspaces ,284 Sum of bedspaces ,284 Maximum VPB ,750 Maximum VPB ,700 Minimum VPB Minimum VPB Range VPB ,730 Range VPB ,673 Average VPB Average VPB Largest increase per bedspace Largest decrease per bedspace Average change per bedspace Largest % increase per bedspace Largest % decrease per bedspace Average % change per bedspace 2, % -73% 42% 41

50 Yorkshire Data breakdowns 2017 Bedspace VPB from 2017 all Difference from 2010 bedspace 1 to 4 2, % 45% 5 to 8 1, % 51% 9 to % 73% 13 to % 76% 21 to % 67% % 35% 2010 Bedspace VPB from 2010 all 1 to 4 2, % 5 to 8 1, % 9 to % 13 to % 21 to % % 2017 VE VPB Diff from all 2017 Difference from 2010 Five star % 56% Four star % 50% Three star % 39% Two star % 69% Mix % 37% 2010 VE VPB from 2010 all Five star % Four star % Three star % Two star % Mix % 42

51 The South West Research Company Ltd. About Us Business partners Paul Haydon and Diane Goffey have gathered over thirty years research experience in the tourism industry and offer an extensive knowledge of tourism and research and statistics built up over many years with an established network of contacts in the industry. Based in the South West, we are proud to be part of and contribute to one of the major industries in our region. We offer a full range of research services tailored specifically to meet our clients needs and available budgets. For further information on the services we offer please contact info@tswrc.co.uk South West based current and previous clients include; 43