Smoke-ban-hit pubs could be in-line for rate cut

Licensees could save thousands of pounds in rates if they can prove their business has been directly affected by the smoking ban.

And pubs that have previously had their appeals rejected by the Valuation Office Agency (VOA), by citing the smoking ban, could be eligible to re-apply for a rate cut.

The VOA threw out pubs' applications for a reduction in their rateable value - after the ban was introduced - on the basis there was no "material change" in the way they were being used.

However, the agency has since had legal advice saying this policy was wrong.

And today local government minister John Healey has written to trade leaders clarifying that some pubs could "potentially" appeal against their current rateable value. The VOA has been trying to contact pubs that were previosuly told their appeals were invalid.

The new VOA guidance, updated in June this year to include advice on the smoking ban, says valuers should take into account the loss of the right for customers to smoke inside when assessing a pub's rateable value.

The guidance says: "In considering smoking ban proposals, VOs [valuation officers] need to envisage what rent would be have been paid for the hereditament at the AVD [original valuation date] assuming the ban was then in place affecting both the subject premises and other premises ... Proposals citing the ban on smoking should be re-examined."

Tony Payne, chief executive of the Federation of Licensed Victuallers' Associations, said he was aware of a number of licensees who were currently appealing their rates - and at least one who had been successful by citing the smoking ban as a factor.

A spokesman for the VOA said pubs "citing the smoking ban will be treated as valid grounds for lodging an appeal".

However he added that a reduction in rateable value will depend on the "individual facts of the case".

"It will be essential to isolate the impact of the ban on the trade achieved by the pub and to disregard changes in trade levels caused by economic factors such as the price of alcohol in supermarkets or individuals economising due to financial pressures," he added.

"It's not necessarily the case that the impact of the ban will affect the rating assessment."

To appeal against your rateable value visit: www.voa.gov.uk/business_rates/appeals.htm