Hotel chain wins appeal against business rates shaving £150,000 off its bill
- Credit: Archant
One of the region’s leading hoteliers has won an appeal to lower business rates on its properties – saving more than £150,000 per year.
Milsom Hotels operates The Pier in Harwich, Kesgrave Hall near Ipswich and Maison Talbooth, Le Talbooth and Milsoms in Dedham.
In 2017, Milsom Hotels faced a sharp rise in its business rates which it pays at 50p in every £1 of rateable value.
Paul Milsom, managing director of Milsom Hotels, said: “Our rateable value went from something in the region of £600,000 to £900,000. So instead of paying £300,000 we were paying £460,000.”
But the company successfully appealed the business rates levied against all five of its properties.
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“Now we’re back paying £300,000,” said Mr Milsom. “It’s been a very lengthy process – three and a half years of immense worry.”
“But because we’ve had large payments coming back it couldn’t have come at a better time. Our businesses have been closed for nearly four months, so having this injection of capital back into them has been really helpful.”
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According to Mr Milsom the tribunal’s ruling does not protect his company from business rates being increased again in the future.
He said: “This could potentially happen again if they come along and somebody ignores all the stuff that we’ve agreed, then they set the rate, and then we have to go through the appeals process.
“And in the meantime we’d have to pay more, starting from day one.”
Mr Milsom said his business was being penalised for how well it ran its hotels and restaurants.
He said: “At the Talbooth we’ve been here for nearly 70 years as a family. We run it in a particular way.
“Because business rates in our sector have been done historically on turnover the more successful you make your business – the better you run it, the more customers that come – you get rewarded with a higher rate. It’s just nuts.”
Mr Milsom said he believes business rates are preventing people from running small hospitality businesses.
He said: ““Lets say you’re a small restauranteur, you and your spouse are working bloody hard at it and you’re pulling in £60,000 a year – you could earn £60,000 as a couple working for someone else quite easily.
“But you want your own restaurant and you’re building it each year. Then because your turnover has gone up they put your rateable value up by £60,000. You’re then paying another £30,000 of tax and you’ve halved your wages.
“And that’s why people say: ‘There’s no point, we’ll go and work for somebody else’.”
Business rates are billed and administered by local councils based upon a rateable value provided by the Valuation Office Agency (VOA).
A VOA spokesman said: “We cannot comment on individual cases. We use a wide range of property information, including rental information, location, trade and physical attributes, to compare values across similar types of properties in order to set the rateable value. This is then used by the ratepayer’s local council to calculate their business rates bill.”
The local councils involved also declined to comment on the specific case.
But Colchester Borough Council encouraged other businesses that believed they had been incorrectly rated to contact the VOA.