Following the UK election in May, the new Conservative-Liberal coalition government is looking at a proposal to scrap the previous administration’s controversial backdated port rates bill.
The charges, which originated from a decision made in 2008 by the Valuation Office Agency (VOA) to impose additional business rates on port companies, attracted wide condemnation because they failed to properly calculate properties or inform those affected, resulting in surprise backdated sums in the millions.
But building on a Conservative manifesto pledge to “introduce an immediate freeze of, and enquiry into, the [previous] government’s punitive programme of backdating business rates on ports”, this week, communities and local government minister Bob Neil told Automotive Logistics News that the new government was taking immediate steps.
"We are taking urgent action to tackle this unfair and retrospective ports tax,” he said. “Firms in ports are a vital part of our export and import trade, supporting Britain's manufacturing industry. We are delivering on our manifesto promise.
“We will be publishing more detail in due course,” said Neil, “but today we are sending an important message to struggling firms who are staring into insolvency that help is on the way."
Furthermore, the Coalition Agreement published last week mentions that a proportion of funds found from “modest cuts” can be used to support jobs through the cancelling of some backdated rates demands.
The announcement has been welcomed by a number of companies and industry bodies in the UK. The British International Freight Association (BIFA) said the move has “removed the sword of Damocles from some businesses at Britain’s ports”.
BIFA director general, Peter Quantrill said the move signals a welcome break for Britain’s hard-pressed international freight sector and allows port businesses to concentrate on facilitating Britain’s import and export freight movements.
Automotive logistics providers that expressed concerns last year have also welcomed the news. CAT (UK), which was pursuing an appeal against the charge, stating it was threatening the company’s activity at Teeside, said it was encouraged by the news and would continue to follow the subject closely. “We have strong feelings regarding the imposition of the retrospective additional tax on our business and have already been financially penalised by it,” commented CAT UK managing director, Stuart Warren. “Our appeal process will continue to be pursued through the recognised formal channels."