Calls for business rates reform to create confidence for firms

The government is being urged to prioritise certainty and predictability when it comes to any reforms to the business rates system.

Call for Evidence on Business Rates and Investment

From 26^th November 2025 to 18^th February 2026, the government ran a Call for Evidence seeking input on the impacts of business rates on investment and options to address barriers.

This Call for Evidence sought stakeholder input on elements of the system, as well as the overall role business rates play in investment.

In addition, a number of ratepayers with large capital expenditure have raised concerns about the impact the receipts and expenditure (R&E) methodology has on investment decisions.

Government should prioritise certainty, predictability and stability

In response to the Call for Evidence, the Chartered Institute of Taxation (CIOT) is urging the government to place certainty, predictability and stability at the heart of any reforms to the business rates system.

The CIOT warns that frequent changes, cliff edges and poorly signposted adjustments risk undermining business confidence and investment.

It believes that businesses making long-term investment decisions need to know how government plans on reform will evolve, what future liabilities might look like, and how valuation changes will be managed.

And, states that clear, consistent policy is essential to prevent unexpected costs and ensure that the system functions as an effective and fair local tax.

Kersten Muller, Chair of CIOT’s Business Rates Working Group, said, “Businesses need a system that allows them to plan with confidence. Predictability is not a luxury but a fundamental principle of good tax design. When the rules change unexpectedly, the result is hesitation—investment is delayed, high streets suffer, and long-term planning becomes difficult.”

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