Hard pressed London businesses and commercial property owners will be less than impressed to learn that over 50 foreign embassies owe local authorities in excess of half a million pounds in unpaid business rates.
Overseas diplomats are officially exempt from most forms of national and local taxation but this immunity does not apply to, what is termed, “charges levied for specific services rendered.”
In this capacity the government has encouraged London embassies to pay a share of business rates that equates to 6 per cent of the level applied to commercial properties. However, the Evening Standard reveals that 51 embassies owe a combined total of £670,000, with the deficit being picked up by businesses.
The outstanding tax bills were uncovered by business rates campaigner Paul Turner-Mitchell under the Freedom of Information Act.
A breakdown of the total shows that the Ivory Coast embassy owes close to £100,000 in unpaid tax followed by the High Commissions of Sierra Leone and Cameroon which owe £55,000 and £46,000 respectively. The Chinese embassy (pictured) owes over £40,000 and the Nigerian embassy £38,000.
“With diplomatic missions having to make a contribution of just 6 per cent of their business rates, on offices mainly in central London, most small businesses will be wondering why countries like China can avoid payment,” said Mr Turner-Mitchell.
The business rates revelation follows news that London embassies have failed to pay over £82 million in congestion zone charges and owe a total of £500,000 in unpaid parking fines.
