Northern Ireland companies have been thrown a short lifeline in the form of an extension of the rates relief programme by up to three months.
Finance minster Conor Murphy said all businesses will have a one-month holiday while retail, hospitality, tourism, leisure, childcare, newspapers and airports will get a three month holiday to help them recover from the impact of the Covid-19 pandemic.
The Executive introduced the rates holiday in March 2020 when the pandemic hit and it was due to come to an end in March this year but inflationary pressures have increased in light of soaring costs for energy and other inputs.
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“Over recent months I have visited businesses from all sectors across the North,” Minister Murphy said. “The common message coming from these businesses has been that the rates holiday was a vital lifeline for them during the pandemic.
He said the rates support package, which includes freezing the regional business and domestic rate for another year and extending the Small Business Rates Relief Scheme, is worth some £50 million.
“Recognising the cost-of-living crisis, I had proposed as part of the draft budget a proposal to freeze both the domestic and non-domestic regional rates for the next three years. This freeze was intended to help with the rising costs being faced by families and businesses alike. While a final budget for the next three years has not been agreed by the Executive, I can proceed with this freeze for the first year.
Business Services Partner at Baker Tilly Mooney Moore Stephen McConnell said the package will ease a small element of the pressure businesses in retail and hospitality are currently facing.
“The package, which extends the full rates holiday in these areas to July 2022, will allow firms that are just getting back on their feet following the removal of all legal Covid-19 restrictions to repurpose the money towards other rising cost bases,” he said, adding that companies should prepare now for the extra costs they’ll face once the rates holidays end.
“Today’s announcement is an opportunity for these companies to prepare their accounts for the three-month extension at a time when their overheads are already being squeezed from all angles, not least due to soaring energy costs and the pending rise in National Insurance Contributions, VAT and wage bills,” he said.