Tesco told it must start paying business rates on mothballed Chatteris store from October

Tesco, Chatteris.

Tesco, Chatteris. - Credit: Archant

Tesco must start paying business rates on its mothballed Chatteris store from October – a move MP Steve Barclay hopes will push the company to sublet it as quickly as possible.

Mr Barclay, MP for NE Cambs, and Fenland District Council wrote to the Valuation Office Agency (VOA) after it became clear Tesco were taking advantage of a technicality that meant they would not have to pay business rates on the building they had commissioned to be built.

Tesco argued the building was incomplete because it was not fitted out and was missing other items, including air conditioning.

However, a completion notice has now been issued and the VOA has now issued a bill – although it is not known what rateable value has been put on the mothballed supermarket.

Tesco should begin payments from July 1, but has been given a three-month exemption period, and so will not actually start paying rates until October.

Mr Barclay hopes the fact Tesco will now have to pay rates will incentivise the supermarket giant into subletting as quickly as possible.

He said: “I welcome this decision by the Valuation Office which I hope will create a strong financial incentive for Tesco to either occupy the premises themselves or more likely to sublet the site to another supermarket provider.

Most Read

“The closure of both supermarkets in Chatteris is causing considerable disruption and dismay to residents who want to see the issue resolved as a matter of urgency.

“I have continued to lobby on behalf of residents for action with both Tesco and Fenland District Council for a supermarket to open in the town.”

A council spokesman added: “In January we asked the VOA to value the site for business rates purposes and to agree that we should issue a completion notice, even though at that time the property was not complete.

“The completion notice is a mechanism that says that they are judged to be in a position to complete it within three months and at the end of those three months we can deem it as complete in terms of charging business rates, whether or not they have completed the works.

“We served a completion notice on Tesco on April 1, meaning that the site is liable for business rates from July 1. However, because all empty properties get a three-month void or free period by law, this means they will actually start paying business rates on the site from October 1.

“The VOA has not yet told us the amount to charge; we are waiting for them to let us know.”

Tesco announced earlier this year that the £22million store in Chatteris was one of 49 to be axed under a cost-cutting programme. At the time it was reported to be paying £1million to the private equity firm that owns the store, off the A142 Fenland Way.

A planned scheme to open a store in Whittlesey was also scrapped.

Following the announcement Tesco created at £20,000 ‘community fund’, in a deal struck by Fenland District Council, that will provide small grants to charities, groups and clubs in the two towns.