The government on Wednesday announced pubs and music venues will get 15% off their business rates bills from April as part of a major support package.
This follows warnings from the sector that changes from November’s autumn Budget would lead to mass closures and job losses.
Treasury minister Dan Tomlinson said the property tax bills in England will then be “frozen in real terms” for the next two years.
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He added that the support will be worth £1,650 for the average pub next year.
However, this was more than offset by the removal of a Covid-era 40% discount to business rates bills for hospitality, leisure and retail businesses, as well as new property valuations.
Paul Crossman, chairman of the Campaign for Pubs, says the government has been ‘quite canny’ with its announcement.
He told the Press: “They have neutralised the bombshell they dropped in November.”
The relief will mean for smaller rates bill rises, he said, and the two-year freeze will deliver certainty.
But venues are still saddled with higher rateable values, which will also affect what they pay for sports tv channels.
Most pubs in the middle, will pay similar to before, the larger pubs “will still face a big increase” and the smallest pubs will face a smaller increase than before.
Paul, who owns the Slip Inn, the Swan Inn and the Volunteer Arms, said: “It’s definitely an improvement on where we were two days ago.”
However, how business rates are calculated is ‘dodgy’ and it needs reforming, with government needing to listen to publicans on future measures.
He welcomed government recognising a need for change as the current business rating system “has lost all confidence,” with a rates revaluation last taking place in 1988.
Paul added: “They are making the right noises. We need them to really deliver. We urgently need proper action on this.”
Landlord John Pybus said: “This announcement does little for The Blue Bell. My rates bill has increased by 292%, and they have been ‘generous’ enough to give us a temporary 15% relief.
“I welcome the reforming of the way pubs’ business rates are calculated, but this will not come into effect until 2029. By then we will see thousands more pubs close.
“This is a sticking plaster patched onto a deep wound that this – and successive governments – have caused.”
Paul Garder of the Terrace sports bar in New Street said the measures announced “were not a bail-out” as venues still face higher bills when wider reform is needed.
He told the Press: “It’s them panicking on an overinflated rateable value that has been given to us.”
Paul noted the German government helped its hospitality sector by reducing their VAT from 17% to 9%.
He continued: “We are not a charitable case. We are an industry that’s overtaxed. We want to be taxed fairly. It’s come to the point where a lot of pubs can’t cope with it.”
Paul Kemp of the Last Drop Inn was still working out the impact on his rates demand, noting it was just a short-term measure when a long-term solution was needed.
He said of the current rating system: “There’s no rhyme or reason to it.”
Rural landlords also seek change.
Simon Wade, who runs four pubs in and around Boroughbridge, says the announcement meant “nothing” with rates demands still set to rise.
The rateable value of the Grantham Arms, he says, has increased 358% from £19,000 to £87,000, meaning his rates payable will increase 92 % from £5,688 to £10,903. After the transition phase, the bill to be paid will be £38,280, 573% higher than today.
Simon said: “They are going to give me a 15% discount. They are off their heads!”
“They need to re-think their calculations,” he said of how rating multiples are assessed.
Simon added: “We are being taxed to the point where we can’t afford to run a small business. I am paying a higher proportion in rates than a large PLC. I am investing my life, my soul, my sweat but I am getting more taxed than a PLC.
“Forget Labour and their U-turns. Labour and their policies are stuck in a u-bend.”
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