The government said under the plans, revaluations of non-domestic properties would take place every three years instead of the current system of five.
Numerous high street firms have long wanted business rates reformed.
The tax is linked to the underlying value of a property, but they are currently based on values from April 2015. That does not reflect how real estate values, particularly in the retail sector, have been hit due to the pandemic and biting competition from online firms.
In addition, rates do not take into consideration how sales are doing.
Today’s proposals are set out in a government consultation that will form one part of its fundamental review of business rates, which will be published later this Autumn.
Financial secretary to the Treasury, Jesse Norman said: “Proposals set out in this consultation would mean that valuations more quickly reflect how the economy is performing, making the business rates system more accurate and responsive, while balancing the burden for ratepayers.”
Helen Dickinson, chief executive of the British Retail Consortium, welcomed today’s update, and said: “This should be the first step towards making the business rates system fairer and more reflective of current economic conditions.”
Melanie Leech, chief executive of the British Property Federation said: “We have long called for the Government to introduce more frequent revaluations. Even before the pandemic, outside of central London, retail rents had fallen by about 30% over the previous decade – and including inflation it’s more like 50% – while rates remain based on outdated rental values from 2015. More frequent revaluations are desperately needed to support high street businesses and a more positive future for our town centres.”
A business rates holiday was launched last year to help firms ride out the virus crisis. From July it is reduced from 100% to 66%.
The 15 month holiday during the pandemic helped firms in the capital collectively save close to £3.5 billion, according to rates expert Altus Group.