Q1. What is 'the multiplier' , rate poundage or rate in the pound?
Q2. When and why does the multiplier change?
Q3. What about the change in multiplier following a revaluation?
Q4. What are transitional arrangements and why do we have them?
Q5 How are increases limited?
Q6. Are reductions in bills limited too?



Q1. What is 'the multiplier' , rate poundage or rate in the pound?
The multiplier is the amount, set by central government each year and used by your local council to calculate how much Business Rates should be paid by each ratepayer within their area.  It is sometimes called the rate poundage or the rate in the pound.
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Q2. When and why does the multiplier change?
The multiplier should normally change every year to move in line with inflation.  By law, the multiplier cannot go up by more than the rate of inflation except following a revaluation (see next question).  This is so that the value raised through Business Rates each year stays the same and the Government can pay for the same level of service from your local council.  If this was not done, there would be reductions in local service levels provided by the council or the shortfall in the cost of the services would have to be made up through national taxes or by increasing the council tax.
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Q3. What about the change in multiplier following a revaluation?
Following a revaluation, the multiplier may change by a higher amount than is explained in the question above, but the total amount raised by the Business Rates will stay the same after allowing for inflation.  So if the total level of rateable values in general have risen, the multiplier will fall to make sure that the total amount raised from ratepayers stays the same.
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Q4. What are transitional arrangements and why do we have them?
Property values normally change a good deal between each revaluation.  Transitional arrangements help to phase in the effects of these changes on ratepayers' bills.  To help pay for the limits on increases in bills after a revaluation, there also have to be limits on reductions in bills.

The transitional scheme for 2005-2010 caps increases to rate bills over a four year period and will be funded by capping reductions in bills and increases in bills.
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Q5 How are increases limited?
Transitional limits apply if, in any  year, the amount you would have to pay (based on your rateable value times the multiplier) is higher than the previous year's bill (based on the amount due on 31 March) by more than the amounts shown below.  If this is the case, your bill will be increased by these amounts.

Year	Small Property (RV < £12000 OR £18000 IN GREATER LONDON)	Large Property  (all others)
2005/06	5%	12.5%
2006/07	7.5%	17.5%
2007/08	10%	20%
2008/09	15%	25%
2009/10	n/a	n/a

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Q6. Are reductions in bills limited too?
Yes. Transitional limits also apply if, in any year, the amount you would have to pay (based on your rateable value times the multiplier) is lower than the previous year's bill (based on the amount due on 31 March) by more than the amounts shown.  If this is the case, your bill will be reduced by these amounts.

Year	Small Property (RV < £12000 OR £18000 IN GREATER LONDON)	Large Property  (all others)
2005/06	30%	12.5%
2006/07	30%	12.5%
2007/08	35%	14%
2008/09	60%	25%
2009/10	n/a	n/a

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