Pubs are set to receive a much-needed boost as the Government plans to ease upcoming increases in business rates. The Treasury is on the verge of announcing a reversal to aid struggling pubs, with additional support anticipated to be revealed soon. This assistance is expected to involve adjustments to business rates and simplification of regulatory processes for licensing.
The decision follows Chancellor Rachel Reeves’ directive to explore ways to assist the hospitality industry before the holiday season in response to significant opposition from businesses. Concerns have been raised by the sector about the prospect of widespread closures due to escalating expenses, leading to some Labour MPs being barred from their local pubs by aggrieved landlords.
Changes to the calculation of business rates scheduled for April were coinciding with the phasing out of a Covid-related discount, which would have resulted in a substantial bill increase for pubs. Ms. Reeves reduced the relief from 75% to 40% during the Budget, with plans to end it entirely in April.
The modifications were supposed to align with adjustments to business rates for all non-domestic properties, based on rental costs in 2024 and potential revenue. Ms. Reeves assured that over 750,000 retail, hospitality, and leisure properties would benefit from lower rates permanently, committing £4.3 billion in support over three years. However, the industry raised concerns as some pubs faced steep rate hikes doubling or tripling their annual bills.
The recent reversal follows previous concessions by the Government in response to protests from farmers regarding inheritance tax hikes before Christmas. Similar climbdowns have been witnessed on reductions to winter fuel allowances and disability benefits.
Emma McClarkin, CEO of the British Beer and Pub Association (BBPA), hailed the Government’s reconsideration of business rates increases as a potential lifeline for pubs nationwide. She emphasized the importance of the Government fulfilling its promises to pubs to ensure their survival and job retention.
Ash Corbett-Collins, CAMRA Chairman, stressed the urgency of providing additional help to pubs to prevent closures and uncertainty. Meanwhile, UKHospitality chief Kate Nicholls called for broader support to all hospitality businesses affected by the rate hikes.
Carolyn Harris MP, Chair of the APPG for UK Spirits, highlighted the significance of supporting pubs beyond just beverages and urged empowerment for the spirits sector to thrive. Cabinet Minister Pat McFadden reiterated the government’s commitment to supporting the pub industry economically and culturally.
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