Explanatory note

Paragraph 2 of Schedule 6 to the Local Government Finance Act 1988 (“the 1988 Act”) provides that the rateable value of a non-domestic hereditament is to be ascertained by reference to the rent at which it is estimated the hereditament might reasonably be expected to be let from year to year.

In those cases where there is no more direct evidence of rental value, the rateable value of a non-domestic hereditament is instead ascertained by decapitalising the estimated total capital value of the hereditament (this is known as “the contractor’s basis of valuation”). The decapitalisation rates are prescribed under paragraph 2(8) of Schedule 6 to the 1988 Act. The principal Regulations made under this power are the Non-Domestic Rating (Miscellaneous Provisions) (No 2) Regulations 1989 (as amended) (“the 1989 Regulations”), Regulation 2 of which prescribes the rates.

The Welsh Ministers in making these Regulations amend, with effect from 11 December 2008, the decapitalisation rates prescribed by Regulation 2 of the 1989 Regulations.

A Regulatory Impact Assessment has been prepared in connection with these Regulations. A copy can be obtained at http://www.assemblywales.org/bus-home/buslegislation/bus-legislation-sub.