MPs demand answers from Valuation Office Agency chief
Select committee chair seeks evidence base for “unfair” Staircase Tax
The chair of parliament’s influential Treasury Select Committee has asked the newly-appointed chief executive of the Valuation Office Agency to explain the evidence base background for controversial business-rates changes dubbed the “Staircase Tax”.
In a just-published letter to Melissa Tatton, who took up her post at the VOA over the summer, select committee chair Nicky Morgan said the tax – which introduces a different basis for charging business rates for firms operating on multiple levels of buildings, depending on the type inter-floor access they have – appeared harsh.
The revision, which follows a Supreme Court ruling in July 2015, charges firms that occupy multiple floors of the same building on the basis that they are a single entity if they have private staircases connecting their floors. Firms that occupy multiple floors of a building, but which have communal areas between the floors, now receive individual rates bills for each floor they occupy.
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In her letter, Morgan asks Tatton for details of the impact analysis conducted into the changes and questions why the VOA is seeking to backdate recalculated business rates to 2015 in England and 2010 in Wales.
“On the face of it, it seems unfair to tax businesses differently depending solely on whether the staircases between their rooms are communal or private,” she said.
“It seems particularly unfair for the increase in rates to be backdated. I have written to Ms Tatton to ascertain the reasons for the VOA backdating it.”
Morgan also asked Tatton whether it was possible that there could be firms that benefited from the change, possibly because of eligibility for small business rate relief.
The committee chair did not call for a full-blown probe into the Staircase Tax, indicating instead that it would be for ministers to decide if they needed to act to offset any unfairness.
Tatton’s appointment as new VOA chief exec was announced at the end of July. She was previously director for individuals and small business compliance at HM Revenue & Customs.
She replaced Pennie Ciniewicz at the VOA, which is an executive agency of HMRC.
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