HUNTINGDONSHIRE s 4,500 rated businesses are still liable for the full five per cent increase in business rates from this month, in spite of the Government s promise to defer some of the increase. Increases in National Non-Domestic Rates, as they are call

HUNTINGDONSHIRE's 4,500 rated businesses are still liable for the full five per cent increase in business rates from this month, in spite of the Government's promise to defer some of the increase.

Increases in National Non-Domestic Rates, as they are called, are pegged to the previous September's RPI, generating the five per cent increase. But in the meantime RPI has plummeted to zero and is widely predicted to turn negative by next September.

The Chancellor of the Exchequer has announced that businesses need pay only 40 per cent of the increase in 2009/10, and can defer the remaining 60 per cent into the two following years.

But no legal basis yet exists for this deferral, so companies remain liable for the full increase.

The same deferral applies to around 180 companies in Huntingdonshire that have been receiving transitional relief - now abandoned - limiting their rates increase as a result of the revaluation to took effect in 2005. A further revaluation will take effect in April next year.

Although Huntingdonshire District Council, which collects business rates on behalf of HM Treasury, has sternly warned businesses not to jump the gun on the deferral by withholding part of the increase, it has promised to take a pragmatic view if firms do that.

What it cannot do is stop its computer from sending reminders and red notices if the full amounts due are not paid, head of customer services Julia Barber told The Hunts Post.

"There are some quite big sums involved here and, if people ring us, I'm sure we can come to some arrangement, as we normally do," she added. "We have no wish to damage the district's economic development and sustainability."

But she warned that the end of transitional relief would mean increases much greater than five per cent for companies getting transitional relief, although they would be liable for only 40 per cent of the increase once the Government had taken powers to allow it - probably not until July.

Formally, HDC is telling companies they cannot defer payment until the legislation has been passed and must maintain payments as billed until the legislation is passed

"There is no need to request deferment until the legislation has been passed and we contact ratepayers to advise them when this happens," HDC added.

Councillor Terry Rogers, whose executive responsibilities include revenue collection, urged small firms to apply for relief if they were entitled and had not already done so.

He said: "We do our best to offer additional help and support where we can. We are asking all small businesses to apply for small business rate relief now if their rateable value is under £15,000, it is their sole business and they are not already gaining from this relief."

The Federation of Small Businesses is urging that small business relief be generated automatically in England, as it is elsewhere in the UK.