Business rates reforms "worth £4.4bn to the North" Handing all the revenues from business rates directly to northern cities could inject £4.4bn into the regional economies of Britain's hardest pressed urban areas, according to research for The Daily Telegraph by consultancy CVS. According to the findings, Manchester would receive around £1.3bn, while the local economy of Leeds and its surrounding metropolitan area in West Yorkshire would benefit from retaining £1.1bn of revenue from the tax on businesses. The Chancellor, George Osborne, is due this month to present a range of policy measures to support the creation of a "Northern Powerhouse" aimed at boosting growth outside the affluent southeast. Handing more revenue from business rates back to local councils had been one of the measures that the Treasury, under lobbying pressure, was considering as part of a package to boost the North ahead of the General Election next year. "In light of the Scotland independence debate, a Pandora's box has been opened on the wider devolution agenda - it's a higher priority than ever to empower regional cities as engines for growth and fiscal devolution is increasingly part of the Localism debate," said Mark Rigby, the chief executive of CVS. Further local retention of business rates could better incentivise economic development and enable local voices to define clearly how this should happen, though we need to understand what this new arrangement would look like. Business rates were last reformed in 2013 when councils were allowed to keep more of the revenue raised from any increased income in an effort to encourage local initiatives to boost business activity. However, Eric Pickles, the Communities Secretary, has called for councils to be allowed to keep up to 90pc of the revenue from business rates, up from 50pc they now retain. The discussions over business rates follows the publication last month of findings by the RSA Cities Growth Commission, which concluded that devolution of more powers outside Westminster had the potential to boost economic output in the UK's 15 largest metropolitan areas by £79bn a year, or 5pc of gross domestic product.