Brown limits tax relief on empty property - commercial mortgages

22 March 2007

Gordon Brown has outlined plans to cut empty property relief (EPR) applicable to empty commercial properties in an attempt to boost supply in the UK commercial property market.

Under new proposals the council tax exemption period for empty properties will be reduced to three months, six months for industrial sites and warehouses. It is hoped that these measures will encourage businesses to take up residency in empty properties, reducing rents and improving access.

This would also encourage new firms to take out commercial mortgages and take advantage of existing properties. However, the Royal Institute of Chartered Surveyors (RICS) is concerned that businesses might not benefit from the changes.

"[The] decision on empty rate reliefs for the commercial sector and charities has been made in isolation and will exacerbate the confusion and problems many businesses face," Brian Berry of RICS told City Wire.

"RICS calls on the government to introduce a scheme that allows the council to work with property owners to agree a way of getting empty property back into use."