The government is reportedly set to back down on proposed business rates rises for pubs.
Rachel Reeves is poised to offer relief to pubs facing the sharpest increases, according to a number of reports. The move is expected to be announced in the coming days.
It will mark a change to measures announced by the Chancellor in the budget, which included ending Covid-era business relief for retail, hospitality and leisure (RHL), and replacing it with a permanent 5p discount to the business rates multiplier for smaller RHL premises.
The discount is being paid for with a 2.8p surtax on the multiplier for all the largest properties in all sectors including RHL.
Critics have argued the 5p discount will not be enough to offset the loss of 40% relief for smaller operators.
Read more: Budget 2025: how Rachel Reeves compromised on business rates
UKHospitality has warned the average pub faces paying £7,000 extra in business rates by 2029, and has urged Reeves to extend the 5p discount to 20p, the maximum possible under legislation.
It has also said the burden should be eased for all hospitality, not just pubs.
“The entire hospitality sector is affected by these business rates hikes – from pubs and hotels to restaurants and cafés,” said UKHospitality chair Kate Nicholls.
“We need a hospitality-wide solution, which is why the government should implement the maximum possible 20p discount to the multiplier for all hospitality properties.”
BRC CEO Helen Dickinson said: “The government has long known the business rates system is not fit for purpose, which is why they promised to replace it in their manifesto.
”With the recent speculation of further concessions for pubs, they have now recognised the most recent reforms announced at the budget do not go far enough. This latest announcement looks like another sticking plaster on a broken system rather than the more fundamental reform required.”
The Treasury was approached for comment.
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