English councils taking part in the government's one-year pilot in which they will retain 100% of business rate revenue will see markedly different levels of benefit to each other, the Institute for Fiscal Studies (IFS) has said. It observed that such councils are expected to collectively increase income by £870 million in 2018-19, but gains will vary from around an extra £59 per person in Berkshire and £49 per person in London councils to just £5 more in Liverpool.
The IFS said an alternative would have been to provide similar levels of extra money and spread them across all councils by means of the block grant, with this providing an average of £16 per person extra, rising to £20 in areas of high spending need.
Report co-author Neil Amin-Smith said that because the pilot is just for one year, "the potential for learning about the impact of a long-term 100% business rates retention scheme is limited". He suggested the aim is to help the government devise amendments to the system before rolling it out nationally.