UK: The Federation of Small Businesses (FSB) has called for air conditioning to be discounted from the UK business rates.

Following the most severe heatwave for decades, the FSB is calling on government to do away with the “little-known tax wrinkle” which hits small businesses that have air conditioning.

Currently the Valuation Office Agency (VOA) includes certain business assets in their valuation. For example, plant and machinery may add value to a property and therefore certain types of plant and machinery are likely to be shown separately in a valuation.

The VOA includes certain business assets which are considered to add value to a property. Categorised as “plant and machinery”, these include air conditioning, as well as CCTV systems, fire alarms, lifts and solar panels. As a result, small businesses face higher rate bills. This covers most business premises, including offices, shops and industrial units.

“It’s time that government helped the nation’s workers stay cool in future heatwaves by removing this aircon tax,” said FSB chairman, advocacy & policy, Martin McTague.

“As temperatures rise in the country’s shops, offices and industrial units, it’s absurd that a business owner gets clobbered with a huge tax bill for investing in their business and trying to keep workers cool and business productive.

“This is just one example of how unfair and regressive the system is, hitting firms before they’ve made their first penny in turnover, let alone profit.”