Local Government, Housing and Planning Committee

Meeting date: Tuesday, May 24, 2022

Official Report 457KB pdf

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Non-Domestic Rates (Coronavirus) (Scotland) Bill: Stage 2

Good morning and welcome to the 16th meeting in 2022 of the Local Government, Housing and Planning Committee.

Annie Wells, Marie McNair and Mark Griffin will be joining us remotely. I ask all members and witnesses to ensure that their mobile phones are set to silent and that all notifications are turned off during the meeting.

Agenda item 1 is stage 2 consideration of the Non-Domestic Rates (Coronavirus) (Scotland) Bill. I welcome to the meeting Tom Arthur, the Minister for Public Finance, Planning and Community Wealth, who is accompanied by Scottish Government officials Sandra Reid, who is the bill team leader; David Smith, who is a lawyer; and Gavin Sellar, who is parliamentary counsel.

Members should refer to the marshalled list and the groupings for stage 2 of the bill, which were circulated last Thursday.

Section 1—Effect of coronavirus on net annual values and rateable values of lands and heritages

Amendment 1, in the name of the minister, is in a group on its own.

Broadly speaking, the bill’s principal rule is that, in the calculation of the net annual value or rateable value in relation to any property in the 2017 valuation roll, no account can be taken of any matter occurring on or after 2 April 2020 that is directly or indirectly attributable to coronavirus. That date is consistent with non-domestic rates policy regarding the definition of “material change of circumstances”, and the circumstances in which general economic factors can be regarded as being relevant to a change in valuation.

Amendment 1 will add a new subsection to section 1 to make it clear, for the avoidance of doubt, that in the application of the bill’s principal rule, 2 April 2020 is the effective date from which a determination cannot reflect any matter that is attributable to coronavirus in rateable value or net annual value. It clarifies that, in the calculation of the net annual value or rateable value of any lands and heritages for the purposes of an entry in the valuation roll, should a matter that is attributable to coronavirus first occur before 2 April 2020 and continue to occur on or after that date, no account can be taken of that matter, with effect from 2 April 2020 onwards. Amendment 1 aims to strengthen the policy intention, and we have discussed it with assessors to ensure, from a technical perspective, that it will do so.

I hope that members will agree with the rationale that I have set out and will agree to amendment 1.

Amendment 1 moved—[Tom Arthur]—and agreed to.

Section 1, as amended, agreed to.

Section 2—Alteration of valuation roll

Amendment 2, in the name of the minister, is grouped with amendment 3.

Broadly speaking, the aim of the bill is to ensure that, with effect from 2 April 2020, no matter that is attributable to coronavirus can be taken into account in a non-domestic property’s net annual value or rateable value in the 2017 valuation roll.

Section 2 will amend section 2(1)(e) of the Local Government (Scotland) Act 1975, which places a legal duty on assessors to alter the valuation roll in certain circumstances while the roll is in force. The 2017 roll is in force until 31 March 2023. Section 2 will expand those circumstances by adding “the coming into force” of the bill.

As the committee will be aware, we have extended the disposal date for appeals until 31 December 2023 so that appellants can make an informed decision as to whether they wish to pursue an appeal once Parliament has finished considering the bill. Should any appeals continue to be pursued after the passage of the bill, it is possible that they might not be determined by 31 March 2023, given the time that it can take for complex appeals to be resolved.

Amendment 2 will remove section 2 and introduce an altogether new provision that creates a new duty requiring the assessor to apply the rule in section 1 to the current valuation roll and to make any resulting change to the net annual value or rateable value of any lands and heritages. The new provision also makes it clear that that obligation applies both while the current 2017 valuation roll is still in force and thereafter.

Our intention is to make it very clear that, should appeals continue to be pursued after the bill is passed, and should any values be reduced with effect from any period prior to 2 April 2020 as a result of a matter that is attributable to coronavirus, the assessor would be required to reverse that change with effect from 2 April 2020 in the 2017 valuation roll. As I have explained, there is no change to the policy intention. Instead, the amendments are intended to strengthen it, and we have discussed them with assessors to ensure that, from a technical perspective, they will do so. I hope that the committee agrees that the new wording makes that intention clearer, while also recognising that any Covid-19 appeals that appellants wish to pursue might not be resolved by 31 March 2023, particularly given the extended disposal deadline of 31 December 2023.

Amendment 3, which is consequential on amendment 2, will add to section 3 a definition of the term “assessor” for the purposes of the bill and ensure that references to that term in the bill are interpreted consistently and with reference to existing legislation. I hope that members will support both amendments.

I move amendment 2.

Amendment 2 agreed to.

Section 2, as amended, agreed to.

Section 3—Interpretation

Amendment 3 moved—[Tom Arthur]—and agreed to.

Section 3, as amended, agreed to.

Sections 4 to 6 agreed to.

Long title agreed to.

That ends consideration of the bill at stage 2. I thank the minister and his officials. Mr Arthur will remain at the table for our next item of business.

I suspend the meeting to allow for a change of witnesses.

10:38 Meeting suspended.  

10:39 On resuming—