Pubs Discount Scheme

About the Scheme

 This scheme is intended to support pubs and is to be known as the 'Pubs Discount Scheme'.

This document sets out the criteria used to determine properties eligible for the Pubs Discount Scheme. The scheme does not require new legislation and does not replace any other relief. Spelthorne Borough Council's scheme essentially mirrors the Guidance issued by Central Government, but additionally refers to 'The Licensing Act 2003 (Consequential Amendment) (Non-Domestic Rating) (Public House in England) Order 2007' for the definition of a pub in deciding eligible properties.

The Council may review and amend the scheme and the amount of relief to reflect any changing circumstances or advice from Central Government.

Introduction

The Government recognised the important role that pubs play in urban and rural communities across the country. In a Written Ministerial Statement on 27 January 2020, the Financial Secretary to the Treasury announced a £1,000 business rate discount for public houses with a rateable value of less than £100,000 for one year from 1 April 2020.

No new legislation is required to deliver the scheme. Instead, Central Government will reimburse Spelthorne Borough Council if we use our discretionary relief powers, under section 47 of the Local Government Finance Act 1988 to grant relief. Central Government will reimburse Elmbridge using grants under section 31 of the Local Government Act 2003, provided our scheme is in accordance with central Government guidance.

This document explains how the scheme will operate and the eligibility criteria that applies in Spelthorne.

Eligibility criteria

This section describes in principle the Pubs Discount Scheme. Spelthorne Borough Council will use this section to determine eligibility for the relief. The scheme will be available to eligible occupied properties with a rateable value of less than £100,000. The majority of pubs are independently owned or managed and will not be part of chains. Where pubs are part of a chain, relief will be available for each eligible property in the chain, subject to meeting State Aid requirements.

There is no definitive description of a traditional pub or public house in law which could be readily used to determine eligibility. Spelthorne will follow the Government's objective and adopt an approach that makes the design and eligibility of the scheme easy to implement in a clear and consistent way, is widely accepted by the industry and which is consistent with the Government's policy intention.

The Government's policy intention is that eligible pubs should:

• be open to the public
• allow free entry other than when occasional entertainment is provided
• allow drinking without requiring food to be consumed
• permit drinks to be purchased at a bar

In addition to determine eligibility Spelthorne will refer to the definition of a pub as set out in the 'Licensing Act 2003 (Consequential Amendment) (Non-Domestic Rating) (Public House in England) Order 2007' which states:

Public house means a property that meets the following conditions:

• a premises licence authorising the sale by retail of alcohol for consumption on the premises has effect;
• the premises are used principally for such sales to members of the public for consumption on the premises; and;
• the sales are not made subject to the condition that buyers reside at or consume food on the premises;

For clarity, Spelthorne (and the Government's) definition of a pub would exclude:

• restaurants
• cafes
• nightclubs
• hotels
• snack bars
• guesthouses
• boarding houses
• sporting venues
• music venues
• festival sites
• theatres
• museums
• exhibition halls
• cinemas
• concert halls
• casinos

This exclusions list is not intended to be exhaustive.

Where eligibility under the criteria is unclear Spelthorne may also consider broader factors in our considerations - ie, in meeting the stated intent of the scheme in that does it demonstrate the characteristics that would lead it to be classified as a pub, for example being owned and operated by a brewery. Additionally, we may also consider other methods of classification, such as the planning system and the use classes order helping decide whether a property is a pub or not. However, permission for a particular use class will not necessarily mean that the property meets the definition of a pub.

How much relief is available?

The total amount of relief available in the year 2020/21 under this scheme is up to £1,000 per eligible occupied property. There is no relief available under this scheme for properties with a rateable value of £100,000 or more. Eligibility for the relief and the relief itself will be assessed and calculated on a daily basis.

This relief will be applied to bills after mandatory reliefs and other discretionary reliefs have been applied, including the retail discount, but excluding those where the council has used its discretionary relief powers under section 47 which are not funded by section 31 grants.

Any award will apply in 2020/21 only and cease at the end of that bill year.

Ratepayers that occupy more than one property will be entitled to relief for each of their eligible properties, subject to State Aid De Minimis limits.

Where relief has been found to have been awarded incorrectly or in error the relief will be removed and amended bills issued. If a change in circumstances that would affect the relief is not informed to the Council within 28 days the Council reserves the right to cancel all relief granted and refuse any further application.

Splits, mergers and changes to existing hereditaments

Pub discount will be applied on a day-to-day basis. A new hereditament created as a result of a split or merger during the financial year, or where there is a change of use, will be considered afresh for the relief on that day.

State Aid

State Aid law is the means by which the European Union regulates state funded support to businesses. Providing discretionary relief to ratepayers is likely to amount to State Aid. However, our pub discount scheme will be State Aid compliant where it is provided in accordance with the De Minimis Regulations (1407/2013).

The De Minimis Regulations allow an undertaking to receive up to €200,000 of De Minimis aid in a three-year period (consisting of the current financial year and the two previous financial years).

The council requires ratepayers to declare within 28 days if they have received an award which exceeds the state aid limit and where a ratepayer is required to complete an application, to make a declaration that any such award would not exceed the limit.

Whilst the UK left the EU on 31 January 2020, the Withdrawal Agreement negotiated by the Government and the EU provides that during an implementation period State aid rules will continue to apply and will be subject to control by the EU Commission as at present. The council will therefore continue to apply State Aid rules, including De Minimis, to this relief in 2020/21.

Delegated Authority to Award Relief

Delegated to Head of Finance or any officer delegated by the Head of Finance, with appeals to Section 151 Officer, Strategic Director and Deputy Chief Executive.

Application Process

As eligibility is defined on the definition of a pub an application will need to be completed by the ratepayer to confirm their entitlement. The ratepayer will also be required to confirm any discount awarded would not exceed State Aid limits. Please contact the council direct to discuss your eligibility and obtain an application form should the criteria be met.

Application Process

There is no statutory right of appeal against a decision regarding discretionary rate relief unless the decision is so unreasonable that no reasonable person could have reached it ('Wednesbury Rules').

However, the Council recognises that ratepayers should be entitled to have a discretionary decision reviewed if dissatisfied with the outcome. Only the ratepayer or authorised agent may appeal against the decision not to award relief or the level of relief awarded. Appeals must be made within four weeks of the notification of decision.

Appeals must be in writing specifying reasons why a decision should be amended and supported by relevant new or additional evidence.

An appeal will be deemed to be discontinued if further evidence requested from the ratepayer has not been received within two weeks of the request.

Appeals against decisions made under delegated authority by the Head of Finance will be considered by the Section 151 Officer, Deputy Group Head and Deputy Chief Executive.