The Royal Institution of Chartered Surveyors is calling for a rethink on empty property tax, which, it says is crippling high streets.
A new survey by RICS found that over 90% of surveyors believe that charges placed on vacant shops and offices are significantly detrimental to the recovery of the nation’s town centres.
Over half even think charges are a contributory factor in property owners demolishing their premises.
When commercial premises, such as retail outlets, become vacant the owner is not required to pay business rates for three months. After this period, however, Empty Property Rates are applicable at the full rate, leaving many with a tax bill which they have no means of funding, says RICS.
Over two thirds (68%) of respondents claimed that commercial property floor space is currently vacant for periods of over six months, meaning that the problem of unmanageable taxes is widespread at a time when businesses are most stretched.
And with the situation continuing to impact so significantly on towns across England and Wales, the knock-on effect is also being felt in capital values. Three-quarters of survey respondents believe the rental value of retail premises will decrease as a direct result of EPR.
RICS chief economist Simon Rubinsohn said: “The charges faced by property owners are quite simply crippling the high street and preventing businesses of all types from achieving financial stability.”
He added that RICS would like to see changes made in the government’s forthcoming Autumn Statement, so that should a retail property owner lose their tenant, no charges would be applicable for six, rather than three, months.