Outcry after private hospitals receive tax breaks instead of NHS

pharmafile | August 22, 2017 | News story | Manufacturing and Production, Medical Communications NHS, biotech, drugs, pharma, pharmaceutical 

It has been revealed that private hospitals being run across England and Wales will receive £52 million in tax breaks over the course of the next five years. This comes even after changes in business rates has meant that NHS hospitals actually face a hike of 21% that will see their own bills increase by £1.83 billion.

The research was conducted by CVS through a freedom of information request, which revealed that 123 private hospitals hold charitable status and can therefore receive business rates relief. Without charitable status, the privately run, for-profit hospitals would have paid £241.4 million but saw this significantly reduced by more than fifth.

This comes as the trust behind an NHS hospital was levied with the sharpest increase in business rate, the Queen Elizabeth Hospital Birmingham, which will be forced to pay a further £2 million in 2017 due to the increases.

A spokesperson for the trust was quoted commenting: “The trust believes there is an anomaly in how NHS trusts are treated for business rates when compared to other organisations such as universities, charitable care facilities and private hospitals. NHS Trusts receive no additional funding to offset business rates costs. We are therefore, alongside other NHS trusts, part of a long-running challenge to seek a similar level of charitable relief on business rates, similar to non-profit organisations.”

Additionally, the report found that Nuffield Health, a healthcare provider that runs a range of private hospitals, private and corporate gyms, will see its bill drop from £15.9 million to just £3.2 million as a result of its charitable status.

Mark Rigby, Chief Executive of CVS, said: “It is iniquitous that NHS hospitals pay normal business rates but 26.9% of private hospitals, using charitable status, receive an 80% discount.”

It has been reported that many hospitals tried to apply to have reduced business rates, on a par with some of the privately-run hospitals, buy were rejected on the basis that the law does not recognise them as charities.

Ben Hargreaves

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