UKHospitality says average business rates rise to hit £32,000

UKHospitality has called on the government to increase the business rates discount for hospitality to the full 20p, having calculated that the average property will see rates rise by £32,714 over three years.

Hospitality operators were left bitterly disappointed by last month’s Budget. The government had suggested that business rates was an area which may provide some relief from rising taxes, but despite the introduction of a £3.2b Transitional Relief scheme, the rates on most properties will still rise dramatically.

UKHospitality said that hospitality businesses in the prime minister’s constituency of Holborn and St Pancras will see an average increase of £96,429 over three years, while in the chancellor’s constituency of Leeds West and Pudsey, the average increase will be £12,297.

Allen Simpson, chief executive of UKHospitality, said: “Business rates tax hikes will hit every city, town, village and high street in the country. Unfortunately, not one area of the country is spared.

“The Treasury were warned, by UKHospitality, to expect significant increases to rateable values, due to the previous revaluation being based on valuations during Covid. We laid out, in no uncertain terms, that the maximum 20p discount to the multiplier was absolutely necessary to offset these rises in rateable values.

“It did not heed that warning, and now the level of business rates increase over three years will be simply unsustainable for many businesses to absorb.

“While Transitional Relief will soften the immediate impact, it does not solve the problem. Price increases, job losses and business closures will all accelerate – that’s bad news for local economies, local jobs and local high streets.

“Implementing a permanently lower multiplier for hospitality is the right policy, but delivering only a 5p discount leaves the policy fundamentally incomplete. The government needs to deliver the full 20p reduction to the hospitality multiplier.

“The government said it would help hospitality businesses – it’s time to take on board our solution and avoid this hospitality tax hike.”