Regional airports face steep business rates increases impacting fares and investment plans
Regional airports across the UK are facing unprecedented increases in business rates bills due to a recent property valuation revaluation, with outer-London airports hit hardest, although major hubs like Heathrow and Gatwick are also affected.
Manchester Airport is expected to see its business rates bill rise by £4.2 million to £18.1 million next year. Other significant increases include Bristol, with a £1.2 million rise to £5.2 million; Birmingham increasing by £1.8 million to £7.6 million; and Newcastle rising £244,755 to £1.1 million. Additional airports affected include Liverpool, rising by £233,100 to £1 million; East Midlands International, up £437,895 to £1.9 million; and Bournemouth, which will pay an extra £102,398 reaching £443,723.
Data from the Valuation Office Agency, analyzed by Ryan, reveals that rateable values have increased more than six-fold in the latest revaluation cycle. Though a 30% transitional relief scheme is in place, many airports will still face significant cost hikes, with most bills expected to more than double over the next three years.
Alex Probyn from Ryan warns that regional airports are unable to absorb a 295% increase in these costs. These hikes will inevitably lead to higher airport charges, increased airline operational costs, and ultimately inflated ticket prices for passengers.
Manchester Airports Group has expressed concern that these elevated rates could force a reassessment of their plans to invest over £2 billion in UK airports over the next five years.
AirportsUK criticizes the Treasury's consultation on business rates as shortsighted and cautions that the increases risk damaging local economies. The group calls for a long-term review of the business rates system to protect investment incentives and support growth in the aviation sector.
