Government to water down business rate rise for pubs

"The government is poised to announce a climbdown on forthcoming increases to the business rates bill faced by pubs. In the coming days the government is expected to say it will make changes to how pubs' business rates are calculated, resulting in smaller rises to bills. Treasury officials say they have recognised the financial difficulties facing many pubs after sharp rises in the rateable value of their premises."

"In her November Budget, Chancellor Rachel Reeves scaled back business rate discounts that have been in force since the pandemic from 75% to 40% - and announced that there would be no discount at all from April. That, combined with the adjustments to rateable values of pub premises, left pubs with the prospect of much higher rates bills. The government had already offered some relief by reducing the "multiplier" used to calculate business rates."

The government will adjust how pubs' business rates are calculated to produce smaller increases in upcoming bills. Treasury officials have recognised the financial strain on many pubs after sharp rises in the rateable values of their premises. In November the Chancellor reduced pandemic-era business rate discounts from 75% to 40% and announced removal of discounts from April, which intensified pressures on pubs. Ministers have already reduced the business rates "multiplier" and are expected to lower it further, alongside a £4.3bn transitional relief fund to help phase in increases. Landlords and industry groups pressured for change, and many view the move as another U-turn on recent fiscal measures.

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