Local Government Finance (Wales) Act 2024

PART 1 — NON-DOMESTIC RATING

Introduction

Overview of Part 1

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• (1) This Part amends the Local Government Finance Act 1988 (c. 41) (“the 1988 Act”), in relation to Wales, as follows.

• (2) Part 3 of the 1988 Act makes provision about non-domestic rating. Sections 2 and 3 insert new sections 41ZA and 52ZA into the 1988 Act, restating provision about the compilation of local and central non-domestic rating lists for Wales. The lists contain details of hereditaments and their rateable values. Sections 2 and 3 shorten the interval between revaluation years from 5 to 3 years. Section 4 inserts a power into the 1988 Act for the Welsh Ministers to alter that interval or the date of a future revaluation year by regulations.

• (3) Schedules 4ZA, 4ZB and 5A to the 1988 Act set out reliefs from non-domestic rating for certain descriptions of hereditaments. Section 5 inserts provision into each of these Schedules for the Welsh Ministers to amend or withdraw existing reliefs and to confer new reliefs by regulations.

• (4) Paragraph 2 of Schedule 4ZB to the 1988 Act provides for full relief from non-domestic rating where a hereditament is unoccupied, the ratepayer is a charity or a registered club and where conditions as to the hereditament’s next use are met. Section 6 restates this paragraph and adds to the conditions that must be met in order for the relief to apply.

• (5) Section 46A of the 1988 Act provides for new buildings to be deemed to have been completed on a certain day (and therefore eligible for inclusion on a local or central non-domestic rating list). Section 7 amends that section (by expanding the definition of a new building) so that it applies to existing buildings that have undergone alterations where those buildings are comprised in hereditaments that have been removed from a list.

• (6) Section 47 of the 1988 Act enables a billing authority to grant or vary relief from non-domestic rating subject to conditions set out in the section. Section 8 amends that section so as to remove the time limit on making decisions granting or varying relief.

• (7) Schedule 5 to the 1988 Act makes provision about hereditaments that are exempt from non-domestic rating and includes a limited power for the Welsh Ministers to confer additional exemptions. Section 9 replaces that power with an unqualified power for the Welsh Ministers to amend or withdraw existing exemptions and to create new exemptions by regulations.

• (8) Schedule 7 to the 1988 Act makes provision in connection with the setting of multipliers used to calculate non-domestic rating. Section 10 inserts a new power for the Welsh Ministers to provide for differential multipliers in respect of descriptions of hereditaments to be specified in regulations. Section 11 amends the formulas in Schedules 4ZA, 4ZB and 5A to the 1988 Act for calculating non-domestic rating in relation to hereditaments in Wales so as to reflect the changes made by section 10 in relation to the setting of differential multipliers.

• (9) Schedule 9 to the 1988 Act imposes duties on ratepayers and potential ratepayers to notify valuation officers of information that relates to their liability to a non-domestic rate in respect of a hereditament, and provides for the enforcement of the duties (through civil and criminal penalties). Section 12 amends Schedule 9 so that these provisions apply in relation to hereditaments in Wales.

• (10) Section 13 inserts sections 63F to 63M into the 1988 Act. The new sections make provision about counteracting advantages obtained from artificial non-domestic rating avoidance arrangements. They include provision enabling the Welsh Ministers to make regulations that provide that an arrangement of a specified type is artificial (unless, in accordance with the regulations, a billing authority or the Welsh Ministers determine otherwise in a particular case); provision requiring billing authorities (or the Welsh Ministers) to treat persons as liable to pay the chargeable amounts that would have been, or would be, payable in the absence of an artificial non-domestic rating avoidance arrangement; provision for a review and appeals process; provision enabling the Welsh Ministers to make regulations imposing financial penalties where a person who is treated as liable fails to pay an amount due.

• (11) Section 14 inserts section 143A into the 1988 Act. Section 143A makes provision about the powers of the Welsh Ministers to make orders and regulations under the Act (restating provisions of section 143 of the 1988 Act in so far as they apply in respect of the powers of the Welsh Ministers).

Rating lists

Local rating lists

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• (1) The 1988 Act is amended as follows.

• (2) In section 41—

• (a) in subsection (1), after “billing authority” insert “in England”;

• (b) in subsection (2), omit “, subject to subsection (2A)”;

• (c) in subsection (2A), for “In the case of a billing authority in England” substitute “But”;

• (d) omit subsection (9);

• (e) in the heading, after “lists” insert “: England”.

• (3) After section 41, insert—

(41ZA) (1) The valuation officer for a billing authority in Wales must compile lists for the authority (to be called its local non-domestic rating lists) in accordance with this Part. (2) A list must be compiled on 1 April in each revaluation year. (3) Revaluation years are 2026 and every third year afterwards. (4) A list comes into force on the day on which it is compiled and remains in force until the next list is compiled. (5) Before a list is compiled the valuation officer must take such steps as are reasonably practicable to ensure that it is accurately compiled on 1 April concerned. (6) No later than 31 December preceding a day on which a list is to be compiled, the valuation officer must send to the authority a copy of the list proposed to be compiled (on the information then before the officer). (7) The authority must keep a copy of the proposed list electronically and must take such steps as it thinks suitable for giving notice of it. (8) As soon as is reasonably practicable after compiling a list, the valuation officer must send a copy of it to the authority. (9) The authority must keep a copy of the list electronically. (10) The valuation officer must maintain a list within subsection (11) for so long as is necessary for the purposes of this Part, whether or not the list is still in force. (11) A list is within this subsection if it was— (a) compiled under this section, or (b) required to be compiled on 1 April 1990, 1 April 1996, 1 April 2000, 1 April 2005, 1 April 2010, 1 April 2017 or 1 April 2023. (12) In maintaining the list that was required to be compiled on 1 April 1990, the valuation officer may take into account information obtained under section 82 or 86 of the 1967 Act.

Central rating lists

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• (1) The 1988 Act is amended as follows.

• (2) In section 52—

• (a) in subsection (1), after “lists”, in the first place it appears, insert “for England”;

• (b) in subsection (2), omit “, subject to subsection (2A)”;

• (c) in subsection (2A), for “In the application of this section to England” substitute “But”;

• (d) omit subsection (8);

• (e) in the heading, after “lists” insert “for England”.

• (3) After section 52, insert—

(52ZA) (1) The central valuation officer must compile lists for Wales (to be called central non-domestic rating lists) in accordance with this Part. (2) A list must be compiled on 1 April in each revaluation year. (3) Revaluation years are 2026 and every third year afterwards. (4) A list comes into force on the day on which it is compiled and remains in force until the next list is compiled. (5) Before a list is compiled the central valuation officer must take such steps as are reasonably practicable to ensure that it is accurately compiled on 1 April concerned. (6) No later than 31 December preceding a day on which a list is to be compiled, the central valuation officer must send to the Welsh Ministers a copy of the list proposed to be compiled (on the information then before the officer). (7) The Welsh Ministers must keep a copy of the proposed list electronically. (8) As soon as is reasonably practicable after compiling a list, the central valuation officer must send a copy of it to the Welsh Ministers. (9) The Welsh Ministers must keep a copy of the list electronically. (10) The central valuation officer must maintain a list within subsection (11) for so long as is necessary for the purposes of this Part, whether or not the list is still in force. (11) A list is within this subsection if it was— (a) compiled under this section, or (b) required to be compiled on 1 April 1990, 1 April 1995, 1 April 2000, 1 April 2005, 1 April 2010, 1 April 2017 or 1 April 2023.

Power to amend revaluation year

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Before section 55 of the 1988 Act, insert—

(54AB) (1) The Welsh Ministers may by regulations amend sections 41ZA(3) and 52ZA(3) so as to— (a) substitute a different year for the year that is for the time being specified as the revaluation year; (b) insert a reference to a different year from the year that would otherwise be the revaluation year; (c) substitute a different interval between revaluation years for the interval that is for the time being specified there; (d) make other amendments to section 41ZA(3) or 52ZA(3) that are consequential on, or incidental to, the amendments made under paragraph (a), (b) or (c). (2) If regulations are made— (a) under subsection (1)(a) or (b), they must specify the same year in both sections 41ZA(3) and 52ZA(3); (b) under subsection (1)(c), they must specify the same interval in both sections 41ZA(3) and 52ZA(3). (3) Where regulations under subsection (1)(c) substitute a different interval, the Welsh Ministers must by regulations also amend the period of years specified in section 58(10)(a) so that it is the same as that interval.

Reliefs

Powers to confer, vary and withdraw reliefs

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• (1) The 1988 Act is amended as follows.

• (2) In Schedule 4ZA—

• (a) after paragraph 8, insert—

(8A) (1) Where this paragraph applies in relation to a hereditament, the chargeable amount for a chargeable day is to be calculated in accordance with the formula— $A×MC-F.$ (2) This paragraph applies in relation to a hereditament where— (a) the hereditament is situated in Wales, and (b) on the day concerned, in relation to the hereditament— (i) conditions prescribed by the Welsh Ministers in regulations are satisfied, and (ii) F is an amount that is greater than 0 but less than the sum of— $A×MC.$ (3) Regulations under sub-paragraph (2)(b)(i) may— (a) prescribe more than one condition or set of conditions that may be satisfied such that this paragraph applies; (b) make provision about the application of more than one condition or set of conditions in relation to a hereditament. (8B) (1) Where this paragraph applies in relation to a hereditament the chargeable amount for a chargeable day is zero. (2) This paragraph applies where the hereditament is situated in Wales and where, on the day concerned, conditions prescribed by the Welsh Ministers in regulations are satisfied. (3) Regulations under sub-paragraph (2) may prescribe more than one condition or set of conditions that may be satisfied such that this paragraph applies. (8C) The Welsh Ministers may by regulations amend or repeal any provision in Parts 2 and 3 of this Schedule for the purposes of varying or withdrawing, in relation to a hereditament in Wales, a relief set out in those Parts.

;

• (b) in paragraph 9, the table is amended as follows—

• (i) in the second row, for “Paragraphs 2 and 4” substitute “Paragraph 2 and any of 4 or 8A”;

• (ii) in each place that it appears in the third and fourth rows, for “or 4” substitute “, 4 or 8A”;

• (iii) after the fifth row, in the first column insert “Paragraph 8B and any of 2, 4 or 8A”;

• (iv) after the fifth row, in the second column insert “Paragraph 8B”;

• (c) after paragraph 9, insert—

(9A) The Welsh Ministers may by regulations amend paragraph 9 for the purpose of providing for the calculation of the chargeable amount in relation to any hereditament in Wales in respect of which more than one paragraph in Parts 2 and 3 of this Schedule apply.

;

• (d) in paragraph 10, after sub-paragraph (6), insert—

(6A) “F” is an amount prescribed, or calculated in accordance with provision prescribed, by the Welsh Ministers in regulations. (6B) Regulations under sub-paragraph (6A) may prescribe different amounts, or make different provision for calculating an amount, in relation to different conditions or sets of conditions prescribed by the Welsh Ministers in regulations under paragraph 8A(2)(b)(i).

• (3) In Schedule 4ZB—

• (a) after paragraph 2, insert—

(2A) (1) Where this paragraph applies in relation to a hereditament, the chargeable amount for a chargeable day is to be calculated in accordance with the formula— $A×MC-F.$ (2) This paragraph applies in relation to a hereditament where— (a) the hereditament is situated in Wales, and (b) on the day concerned, in relation to the hereditament— (i) conditions prescribed by the Welsh Ministers in regulations are satisfied, and (ii) F is an amount that is greater than 0 but less than the sum of— $A×MC.$ (3) Regulations under sub-paragraph (2)(b)(i) may— (a) prescribe more than one condition or set of conditions that may be satisfied such that this paragraph applies; (b) make provision about the application of more than one condition or set of conditions in relation to a hereditament. (2B) (1) Where this paragraph applies in relation to a hereditament, the chargeable amount for a chargeable day is zero. (2) This paragraph applies where the hereditament is situated in Wales and where, on the day concerned, conditions prescribed by the Welsh Ministers in regulations are satisfied. (3) Regulations under sub-paragraph (2) may prescribe more than one condition or set of conditions that may be satisfied such that this paragraph applies. (2C) The Welsh Ministers may by regulations amend or repeal any provision in Part 2 of this Schedule for the purpose of varying or withdrawing, in relation to a hereditament in Wales, a relief set out in that Part. (2D) (1) In relation to a hereditament in respect of which paragraph 2 and any of paragraphs 2A or 2B apply, the chargeable amount for a chargeable day is to be calculated in accordance with paragraph 2. (2) But if paragraph 2 does not apply in relation to a hereditament in respect of which paragraphs 2A and 2B apply, the chargeable amount for a chargeable day is to be calculated in accordance with paragraph 2B. (2E) The Welsh Ministers may by regulations amend paragraph 2D for the purpose of providing for the calculation of the chargeable amount in relation to any hereditament in Wales in respect of which more than one paragraph in Parts 2 and 2A of this Schedule apply.

;

• (b) in paragraph 3, after sub-paragraph (5) insert—

(5A) “F” is an amount prescribed, or calculated in accordance with provision prescribed, by the Welsh Ministers in regulations. (5B) Regulations under sub-paragraph (5A) may prescribe different amounts, or make different provision for calculating an amount, in relation to different conditions or sets of conditions prescribed by the Welsh Ministers in regulations under paragraph 2A(2)(b)(i).

• (4) In Schedule 5A—

• (a) after paragraph 4, insert—

(4A) (1) Where this paragraph applies in relation to a hereditament, the chargeable amount for a chargeable day is to be calculated in accordance with the formula— $A×MC-F.$ (2) This paragraph applies in relation to a hereditament where— (a) the hereditament is situated in Wales, and (b) on the day concerned, in relation to the hereditament— (i) conditions prescribed by the Welsh Ministers in regulations are satisfied, and (ii) F is an amount that is greater than 0 but less than the sum of— $A×MC.$ (3) Regulations under sub-paragraph (2)(b)(i) may— (a) prescribe more than one condition or set of conditions that may be satisfied such that this paragraph applies; (b) make provision about the application of more than one condition or set of conditions in relation to a hereditament. (4B) (1) Where this paragraph applies in relation to a hereditament the chargeable amount for a chargeable day is zero. (2) This paragraph applies where the hereditament is situated in Wales and where, on the day concerned, conditions prescribed by the Welsh Ministers in regulations are satisfied. (3) Regulations under sub-paragraph (2) may prescribe more than one condition or set of conditions that may be satisfied such that this paragraph applies. (4C) The Welsh Ministers may by regulations amend or repeal any provision in Part 2 of this Schedule for the purpose of varying or withdrawing, in relation to a hereditament in Wales, a relief set out in that Part.

;

• (b) in paragraph 5(1)(a), for “a central non-domestic rating list in force for the year” substitute “the central non-domestic rating list in force for the year in relation to England”;

• (c) after paragraph 5, insert—

(5A) (1) This paragraph applies if— (a) for any day in a financial year any description of hereditament is shown against a person’s name in the central non-domestic rating list in force for the year in relation to Wales, and (b) more than one of paragraphs 2, 4A and 4B apply in relation to that description of hereditament for that day. (2) If paragraph 4B and any of paragraphs 2 or 4A apply in relation to that description of hereditament for that day, the chargeable amount for that day is to be calculated in accordance with paragraph 4B. (3) But if paragraph 4B does not apply in relation to that description of hereditament for that day, the chargeable amount for that day is to be calculated in accordance with paragraph 2. (5B) The Welsh Ministers may by regulations amend paragraph 5A for the purpose of providing for the calculation of the chargeable amount in relation to any description of hereditament in Wales in respect of which more than one paragraph in Parts 2 and 2A of this Schedule apply.

;

• (d) in paragraph 6, after sub-paragraph (5) insert—