Air con: Small businesses left to swelter in heatwave by business rates system

As the most severe heatwave for decades continues to sizzle across the UK, the Federation of Small Businesses (FSB) is calling on Government to do away with a little-known tax wrinkle which hits small businesses that have air conditioning.

Currently the Valuation Office Agency (VOA) says having air conditioning adds value to property. As a result, small businesses face higher rate bills. This covers most business premises, including offices, shops and industrial units.

Martin McTague, FSB Chairman, Advocacy & Policy, said:

“It’s time that Government helped the nation’s workers stay cool in future heatwaves by removing this Aircon Tax.

“As temperatures rise in the country’s shops, offices and industrial units, it’s absurd that a business owner gets clobbered with a huge tax bill for investing in their business and trying to keep workers cool and business productive.

 “This is just one example of how unfair and regressive the system is, hitting firms before they’ve made their first penny in turnover, let alone profit.”

Other assets that the VOA uses as a means to further increase, already hefty, business rates bills include CCTV systems, fire alarms, lifts and solar panels.

Notes to editor

“The VOA will include certain business assets in their valuation. For example, plant and machinery may add value to a property and therefore certain types of plant and machinery are likely to be shown separately in a valuation.” - https://www.gov.uk/guidance/how-non-domestic-property-including-plant-and-machinery-is-valued

About FSB
As experts in business, FSB offers members a wide range of vital business services, including advice, financial expertise, support and a powerful voice in Government. Its aim is to help smaller businesses achieve their ambitions. More information is available at www.fsb.org.uk. You can follow us on twitter @fsb_policy.