UK | Hospitality business rates reform has been described as "unravelling", with industry leaders calling for urgent action in the sector.
Eye-watering increases to rateable values will see an average pub pay GBP 12,900 more in business rates over three years, as rates climb 76 percent for pubs and 115 percent for hotels.
New analysis from UKHospitality shows that the average pub’s business rates, even with the reduced multiplier and transitional relief, will increase 15 percent next year, an extra GBP 1,400.
In 2027/28, an average pub’s rates will be GBP 4,500 higher than today, and in 2028/29 GBP 7,000 higher. In total, over the three years, an average pub will pay an extra GBP 12,900.
A hotel will be paying an extra GBP 28,900 in rates next year. In 2027/28, it will be GBP 65,000 higher than today and in 2028/29 GBP 111,300 higher. In total, over three years, an average hotel’s rates bill will increase by GBP 205,200.
By 2028/29, an average pub’s business rates will have increased by 76 percent and an average hotel’s by 115 percent.
In comparison, the rates bill for a distribution warehouse, the likes used by online giants, will have only increased by 16 percent, an office building will have only increased by 7 percent and a large supermarket by only four percent by 2028/29.
UKHospitality has called for the Chancellor to urgently increase the level of business rates discount for hospitality properties from 5p to 20p, as previously proposed and permitted by law.
“The Government promised in its manifesto that it would level the playing field between the high street and online giants. The plan in the Budget to achieve this is quickly unravelling, and will deliver the exact opposite,” said Kate Nicholls, Chair of UKHospitality.
“Our analysis shows that hospitality businesses will be paying more. Pubs will see bills increase by thousands and hotels by tens of thousands. We repeatedly warned the Treasury ahead of the Budget that hospitality would be uniquely impacted by significant increases to rateable values, due to the pandemic impacting previous valuations. This had to be factored into the level of business rates discount it offered the sector.”
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