The introduction of the legislation follows a decision in the Supreme Court (Woolway v Mazars) which brought about a change the practice of the Valuation Office Agency (VOA) in assessing rateable values for businesses that operate in adjoining units or rooms, but are accessed from a common corridor or staircase.

Following this ruling, businesses who occupied more than one property in a shared building received a separate rates bill for each unit. This was widely known as the ‘staircase tax’ and meant businesses in adjoining units who had previously received one rates bill, were now being subject to several bills.

Some businesses were paying more overall due to the loss of small business rate relief – a discount applied to the bills of certain businesses with a lower rateable value.

This ruling overturned an established and widely understood practice where businesses occupying two adjoining floors or two rooms separated by a wall only received a single bill.

The introduction of the bill means these firms will be able to choose to have their rates recalculated under the old single bill system and any savings due backdated.

Communities Secretary Sajid Javid said: ‘For years firms in adjoining units or rooms rightly received one rates bill, but this court ruling meant they faced multiple bills for operating in an office linked by a communal lift or stairs.

‘This was a completely unreasonable burden on businesses which this legislation will put a stop to.’

Subject to Parliamentary approval of the bill, those businesses who have been directly impacted by the Supreme Court judgement can ask the VOA to recalculate valuations based on previous practice.

It can then have its bill recalculated if it chooses, and backdated. This includes those firms who lost small business rate relief.

Report by Pat Sweet