This is what the main parties in England are promising to do about the thorny issue of business rates ahead of the general election on 12 December 2019.

Conservative Party

In its manifesto, the Conservative Party promises to reduce business rates “via a fundamental review of the system”. This is in line with the recommendations made in the Treasury Committee’s First Report of Session 2019-20 on its inquiry into the impact of business rates on business published on 31 October 2019. In the interim, the manifesto indicates that the Conservative Party will increase the retail discount, which is available for one more year, and extend it to music venues, small cinemas and pubs in an effort to protect the high street and keep town centres vibrant.

Labour Party

The Labour Party manifesto notes that business rates are causing real issues for high-street retailers and others and states that a Labour government would review the option of a land value tax on landlords as an alternative. This option was recommended by the ‘Land for the Many’ report prepared for the Labour Party as part of its policy development for the upcoming general election. That report proposed that, whilst taxing land is one of the most efficient ways of raising taxes, a tax on commercial property calculated on the basis of its rental value should be levied against the property owners rather than the businesses in occupation. The manifesto also proposes supporting the steel industry as part of a Green Industrial Revolution by exempting new capital from business rates.

Liberal Democrat Party

The Liberal Democrat Party manifesto promises to replace business rates in England with a Commercial Landowner Levy based solely on the land value of commercial sites rather than their entire capital value pursuant to the recommendation of a report entitled ‘Replacing business rates: taxing land, not investment’ prepared in September 2018. The intention, as with Labour’s policy proposal, is to stimulate investment and shift the burden of taxation from tenants to landowners.

Green Party

The Green Party manifesto also promises to replace business rates (and other property taxes) with a Land Value Tax, which it says will help stabilise the property market and shift the burden of taxation from land users, including renters and business tenants, to wealthy landowners. The proposed LVT charge is estimated to be around 1.4% of current values. They would also legislate to prevent landowners passing these tax costs back to renters and tenants. The changes would be phased in over 10 years with various reliefs available.

The Brexit Party

The Brexit Party’s “Contract with the People” states that it would replace business rates with a simpler system, which it says will assist small High Street retailers and leisure operators outside the M25, with any reductions funded by an online sales tax.


The UK Independence Party’s manifesto for the 2017 general election, ‘Britain Together’, promised to cut business rates by 20% for 1.5 million British businesses operating from premises with a rateable value of less than £50,000. It has not included this proposal in its manifesto for the upcoming general election.

The origins of business rates extend back at least as far as Elizabethan England. The Poor Relief Act 1601 empowered each parish to collect poor rates and allocate relief to the local poor. Poor rates were originally a form of local income tax but evolved into a tax based on the value of property. Rates have remained a consistent feature of local taxation ever since. They have generally been payable by the tenant or occupier rather than the owner. Indeed, the Rating and Valuation Act 1925 acknowledged this principle by allowing the owner to keep 5-15% of the amount due in return, effectively, for collecting the rates on behalf of the local authority.

As can be seen, at least three of the main political parties are ready to overturn the principle that the occupier of commercial property, arguably the beneficiary of the services provided by the local authority, should be primarily liable for business rates. They propose replacing it with a land value tax payable by the landlord and, presumably, not recoverable from the tenant.

Time will tell how the business rates system will evolve whichever political party is in government.