Hospitality Industry Faces Potential £914 Million Business Rates Hike in April
Posted by Emma on 16th Oct 2024
The hospitality sector in the UK is facing a significant increase in business rates, with a potential bill of £914 million by April if current policies remain unchanged. UKHospitality, a leading industry body, has raised concerns about the “eye-watering” rise, calling for urgent action from the government to prevent severe financial strain on businesses.
The rise in business rates is linked to September’s Consumer Price Index (CPI), which determines annual adjustments to rates in England. The Office for National Statistics (ONS) has confirmed that inflation fell to 1.7%, yet this still represents a substantial £48 million increase in business rates for hospitality businesses. This would be in addition to an £866 million rise if the existing business rates relief is not extended, bringing the total to £914 million.
According to UKHospitality, business rates account for around 5% of the sector’s turnover. Large pubs and restaurants could face an average increase of £33,500 in their rates without reform. Kate Nicholls, Chief Executive of UKHospitality, expressed deep concern over the figures, warning that without intervention in the upcoming Budget, many venues could be forced to make difficult choices, including cutting staff hours, reducing operations, or even shutting down permanently.
Nicholls highlighted the importance of addressing business rates in the hospitality industry, noting that a lower rate would alleviate the financial burden and stimulate local economies by fostering job creation and protecting high-street businesses. She emphasised that the upcoming Budget, set for 30 October, represents a critical opportunity for the government to support a sector central to many communities across the UK.
The future of the hospitality industry, which plays a pivotal role in the nation’s social and economic fabric, could be at risk if these issues are not addressed. The decisions made in the forthcoming Budget could determine whether businesses continue to thrive or face a challenging road ahead.