The policy column

Taxing times
Alistair Brown
There hasn’t been much good news for the museum finances of late, but a couple of decisions from the world of tax law offer a glimmer of hope.

The first is the recent court case brought by York Museums Trust (YMT), which challenged the way in which its business rates were set. The trust disputed the use of an approach known as the contractor’s method to calculate its business rates, on the grounds that it unfairly penalises museums housed in large, old and listed buildings, and can result in tax bills up to four times as high as the alternative method.

The court judged in favour of YMT, and in favour of the use of an alternative “receipts and expenditure” calculation, which could reduce many museums’ rates (though it may increase the bills for a few others). Given that around 700 UK museums are subject to the contractor’s method, museums are being encouraged to check if they could benefit from a different valuation method, and to appeal before 30 September.

The second tax issue is the Museums and Galleries Tax Relief, which was launched in April, but then delayed by the general election. If and when it is delivered, this relief
will mean a refund of up to £100,000 on the costs of new exhibitions, so we see this as a real priority for the sector. We’re working closely with ministers to ensure that the legislation is reintroduced as soon as possible so museums of all sizes can benefit.

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