Latest news with #businessrates
The Sun
6 days ago
- Business
- The Sun
Pubs, clubs & shops set for tax cuts, says Business Secretary Jonny Reynolds as he vows to make Britain ‘fun' again
PUBS, clubs and shops are set to get tax cuts in the Budget, Business Secretary Jonny Reynolds has revealed. He also vowed to make Britain 'fun' again as he unveiled sweeping reforms to tear up red tape so boozers and cafes can open in empty shops and have outside dining. 2 In an interview with The Sun on Sunday, he admitted businesses have been hit hard by the hike in NICs taxes saying 'there is a cost - you can't deny that'. But he vowed to slash levies on high street firms with 'permanent' cuts to business rates in this year's Budget - expected in November. Mr Reynolds said: 'We would want to reduce the burden on businesses wherever we can, because we want them investing in people - new jobs, solid wages.' He added: 'The objective is permanently lower business rates for retail, hospitality and leisure. 'It is a disproportionate tax burden. I believe the objective is to have that in the Autumn Budget.' Ministers have been consulting on how to reform business rates to make the tax fairer. Mr Reynolds also announced a radical shake-up of planning rules to slash red tape on pubs and clubs. Boozers, cafes and music venues will be able to open in closed down shops. New 'hospitality zones' will be created where it will be easier for venues to open late, let people dine outside and throw street parties. Nimbies will be stopped from closing down well-loved venues with noise complaints, he added. Pub chain collapses into administration as SIX sites shut their doors for good and 159 job losses Banging the drum for more fun in our city centres, Mr Reynolds declared: 'We want to take the burden off the kind of things businesses can do to grow and employ more people. 'We want more enjoyment and more fun in town centres.' Mr Reynolds also blasted leftie Labour MPs demanding a wealth tax - and warned they are putting investors off the UK. Branding the demands 'not a serious take', he added: 'If people worry the UK is thinking of a tax that doesn't exist anywhere in the world, that is not good for the UK - and people will think twice if that's the case.' Hospitality bosses welcomed the plans to slash red tape - but warned sky-high taxes are crippling high streets. Kate Nicholls, chair of UK Hospitality, said: 'Positive and encouraging as these measures certainly are, they can't on their own offset the immediate and mounting cost pressures facing hospitality businesses which threaten to tax out of existence the businesses and jobs. 'Let's hope that this is just the start of a bold, long term plan for the high streets and hospitality.' 2
The Independent
20-07-2025
- Business
- The Independent
Why are Tesco and Sainsbury's calling on Rachel Reeves to make a fresh U-turn on tax?
R achel Reeves is facing a fresh rebellion, but this time, the opposition is coming from Britain's biggest supermarkets, not the Labour back benches. Tesco and Sainsbury's have joined forces with pubs, restaurants and other hospitality businesses to warn the chancellor against a planned £1.7bn tax raid on the industry. The Independent looks at what the businesses are worried about, and whether their warnings are likely to be heeded. What is the tax raid? The grocery giants' intervention focuses on the chancellor's plans to overhaul the business rates system. Changes outlined by Ms Reeves in her Budget last October will lead to higher payments for department stores, big supermarkets and other businesses with larger sites. At the time, the chancellor said she was creating a 'fairer business rates system' by permanently lowering payments for high street retail, hospitality and leisure properties. To fund lower rates for businesses worth less than £500,000, Ms Reeves outlined plans for those worth more than £500,000 to pay a higher rate. The government is also scrapping a relief enjoyed by the companies, granting them 40 per cent off their business rates bills up to £110,000, which currently costs the Treasury £1.7bn a year. 'This measure will provide certainty and support for the high street,' the government said at the time. What do critics say? Tesco chief executive Ken Murphy told The Telegraph that the changes will threaten 'investments in customers, colleagues and communities'. 'Increasing the burden on large shops would hinder rather than help our town centres. Many of these shops are anchor stores in their local communities,' the retail chief added. And Sainsbury's boss Simon Roberts said big retailers, already struggling with higher national insurance contributions and the minimum wage hike, would 'pull away from our high streets'. He told the paper: 'The changes being proposed will further increase the negative impact of business rates and won't stimulate the growth or investment into our high streets and jobs that we all want to see.' The British Retail Consortium (BRC) estimates that around 4,000 large retailers will be hit by the changes. It argues that these 'anchor stores' drive footfall and help sustain surrounding businesses and communities. What do they want changed? The BRC wants the government to exclude shops from the higher rate payment, the level of which is set to be unveiled in the autumn Budget and take effect from next April. Funding the exemption of shops would require smaller retail, leisure and hospitality firms to pay slightly more. Will the government listen? It is rare for the likes of Sainsbury's and Tesco to publicly speak out against government policy, and the intervention is a sign of the growing frustration among retail and hospitality bosses at Ms Reeves and Sir Keir Starmer. The industry has already been hit with national insurance hikes, a minimum wage increase and is bracing for the imposition of Angela Rayner's employment rights shake-up. Pub bosses have warned they are already seeing record closures and the business rates reforms will cause more to shut down. Labour came to power with a promise to govern as a party of business, and the Treasury will certainly take note of the retailers' calls. However, with the chancellor already under pressure to raise as much cash as possible in her next Budget, any move that critics could paint as a bung to big business will prove politically difficult.
Daily Mail
20-07-2025
- Business
- Daily Mail
EXCLUSIVE How Labour is 'taxing the high street into bankruptcy': Family-run pubs, bakeries and shops are hit with sneaky 200% hikes in business rates
Labour was today accused of 'taxing the high street into bankruptcy' through their punishing 'stealth' levy on small firms. Since Rachel Reeves quietly reduced much–needed reliefs last autumn, family–run pubs, bakeries and restaurants have been battered a rise in business rates. Startling figures recorded by one council reveal an independent pub was stung by a 226 per cent hike in fees, costing them almost £17,000 for one year. Meanwhile, supermarkets escaped with rises of as little as one per cent in business rates, which are similar to council tax for non–domestic properties. Although MailOnline has only obtained business rate rises for Central Bedfordshire Council (CBC) – an area that covers Leighton Buzzard, Dunstable and Biggleswade, experts warn the situation will be mirrored up and down the country. Cllr John Baker, who controls the pursestrings at CBC, said: 'The government seems totally incapable of controlling public spending, clobbering business to fund its profligate behaviour. 'If the Chancellor is serious about improving the poor economic climate, reversing those outrageous hikes in business rates and allowing businesses to hire more people would be a sensible first step.' Department stores and supermarkets are also in the firing line in the Chancellor's next Budget. In hope of clawing back billions, Ms Reeves is expected to increase business rates for bigger firms – despite warnings it will only accelerate the decline of the high street and lead to price rises. In last autumn's budget, Ms Reeves boasted that she was extending business rates reliefs for retail, hospitality, and leisure. But she actually reduced the Covid-era discount from 75 to 40 per cent – capped at £110,000 across an entire business. Smaller businesses are typically the biggest beneficiaries because they have fewer locations to spread this discount across. During the same budget, branded a 'disaster' by critics, Ms Reeves hiked employer National Insurance contributions and cut the threshold at which firms become liable to pay them. The minimum wage also rose to £12.21 an hour. The Federation of Small Businesses warned the triple whammy posed 'an existential threat to the future of the high street'. Paul Wilson, the FSB's policy chief, told MailOnline the 40 per cent relief was 'scant consolation for a squeezed business owners trying to find thousands of pounds'. He said businesses couldn't fight back by hiking their own prices because customers 'can only afford so much'. Job cuts and shorter opening hours – caused by businesses trying to claw back cash – risked handing bigger players an even greater advantage, Mr Wilson claimed. He said: 'The feedback were are hearing is that businesses are having to take those difficult decisions to scale back. High street businesses are questioning whether they can genuinely afford to keep competing with online.' The FSB's latest survey showed a record 41 per cent of small businesses now believe the tax burden is a top three barrier to growth. In Bedfordshire, local pubs and restaurants have seen their rates more than double. Data provided by Cllr Baker shows this costs businesses as much as £25,000 a year – more than a minimum wage full–time workers' annual salary. Award–winning pub, the Black Lion, on Leighton Buzzard High Street, was hit with a 226 per cent rise (£16,900) in its rates, from around £7,400 to £24,300. By contrast, many big supermarkets such as Tesco, Asda and Sainsbury's saw their rates raise by less than two per cent. Other firms have seen even bigger jump proportionally, including upmarket eatery Eileen's by Steve Barringer – a MasterChef: The Professionals finalist – where rates have shot up 260 per cent, from £300 to £1,080. What are business rates and who has to pay? Business rates are charged on most non-domestic properties, including shops, offices, pubs, warehouses, factories and holiday rental homes or guest houses. Rates are calculated by the Valuation Office Agency, part of HM Revenues and Customs, based on the cost of renting the business premises for a year, currently from April 2021. A rates 'multiplier' is then used to come to the final amount. This number has risen from about 34p in the pound in 1990 to 54.6p today for premises with a rateable value more than £51,000 or 49.9p for if it is less. Certain properties are exempt from business rates, for example farm buildings or places used for the welfare of disabled people. Other firms are entitled to discounts based on the nature and size of their business, for example, independent pubs and shops are likely to be eligible for at least one relief. Our analysis suggested that, on average, independent food and drink venues saw a 120 per cent rise in business rates, compared to an average of just one per cent for bigger firms. We have defined independent businesses as any which receives a relief designed to help what many would consider small or independent local firms. This is wider than just the businesses that get 'small business rates relief', which only applies to property with a rateable value of less than £15,000 and if the business has only one premise. Husband and wife Anthony and Anne Smith, who have owned and run two framing shops in Bedfordshire for the past 40 years, have been hit by a 150 per cent rise in their business rates. It will cost them more than £5,500 extra a year. Allframe, which employs half a dozen staff across the Leighton Buzzard and Dunstable sites, will likely have to raise their prices more than expected to cope, despite fears this could disrupt sales. Mr Smith told MailOnline: 'The problem you've got in any business when you get price increases is that you have to absorb the increase or put prices up. 'We've tried not to put our prices up as we're a luxury business. 'People need to go to to Tesco and Aldi to put food on the table... but don't need to get their pictures framed professionally.' The picture framer added that rates rises will 'ultimately go into it when we reevaluate prices'. Mr Smith added: 'Five thousands pounds is a lot to come off your bottom line in one fell swoop, when it's something you weren't expecting.' 'It will mean our prices go up more than we would have liked them to. It's going to impact on our profitability.' 'I think there's a general feeling that it's always small and medium businesses that that get hit,' Steve Watkins, cabinet member for business at Central Bedfordshire Council told MailOnline. 'These businesses have struggled since the pandemic and have not been able to get back to where they were before. 'The Government should target the big players in the market, rather than smaller businesses. Where's the huge tax increases on Starbucks and Amazon? 'If they want to regenerate town centres they are going about it the wrong way by making it harder for small businesses to survive.' He said the added costs are making it 'harder then ever' for small business owners, who are already facing skyrocketing rents, energy bills and wage bills, adding that they were at 'the end of their tether'. In Labour's manifesto, the PM pledged to replace business rates – which he said 'disincentivises investment, creates uncertainty and places an undue burden on our high streets' – with a new system. Business rates are calculated based on multiplying the 'rateable value' – an estimate of the annual rent in April 2021 prices – by a multiplier of 49.9p for the smallest of businesses, and 55.5p for all others. The Government announced last year it will permanently introduce a lower multiplier for retail, hospitality and leisure businesses with a rateable value of less than £500,000. The multiplier value is yet to be announced. Cllr Watkins accused Sir Keir of 'not being upfront with people' over the reduction in the rates relief, saying the announcement was the 'politics of spin'. He said the rates were a 'stealth tax' on business and were not as 'generous' as the Government claims, adding they 'absolutely have the possibility of taxing high streets and small businesses into bankruptcy'. Cllr Watkins added that if the direction of travel continues, it was hard to see how local businesses will still be around in a few years time, leading to an 'increasingly soulless high street'. 'If this is the first step to reforming, I dread to see what the next steps will be, as these ones have gone down like a cup of cold sick,' he added. 'Technocratic governments are big on five to ten year plans, but these businesses need plans now. 'The proof will be in the pudding... but the fact that they've not been upfront so far suggests we need to dig beneath the surface before I start clapping my hands.' A Government spokesman told MailOnline: 'Our reform to the business rates system will create a fairer business rates system that protects the high street, supports investment, and levels the playing field. 'A new, permanently lower business rates in 2026 will benefit over 280,000 retail, hospitality and leisure business properties and will be sustainably funded by a new, higher rate on the 1% of most valuable business properties.'
Telegraph
20-07-2025
- Business
- Telegraph
Labour's endless red tape is killing off the Welsh holiday
Has your holiday let business been affected by anti-tourist policies? Email money@ After a 37-year career in the Royal Navy, Ian Pattinson is tougher than most. But there's one thing that keeps the former captain awake at night and it's nothing to do with his military service – it's his Welsh holiday home. 'Every single day I worry about whether I'm going to make 182,' he says. Pattinson is referring to the number of days his two cottages have to be let each year to qualify for business rates following a change by the Welsh government two years ago. If he fails to hit the target, the properties will be subject to council tax leaving Pattinson with a £2,000 bill. For some Welsh holiday let owners, the bill can come close to £10,000 because their properties are subject to paying a 200pc second home premium. The 182-night rule is just one of a raft of measures brought in by the Welsh government in the past five years that has seen overnight tourist numbers plummet and holiday let owners exit the business. The Professional Association of Self-Caterers (Pasc) has identified 17 government interventions from both the Senedd and Westminster that it says are negatively impacting the sector in Wales. Pattinson, 66, moved to the outskirts of Newport in Pembrokeshire with his wife 10 years ago so the two could enjoy a comfortable retirement. The stone cottages are nestled against the slopes of the ancient Preseli Mountains, in the heart of Pembrokeshire Coast National Park. 'For 10 years, we were living the dream. It was excellent. We only had to hit 70 days a year [to qualify for business rates] which we could easily manage. My wife and I both made £7,500 each per cottage and it helped boost our retirement income. 'But the onslaught of policies flooding through the industry at the moment is unbelievable.' On top of a daily worry about whether he'll be landed with a council tax bill, he expects it will cost him £15,000 to upgrade the former farm building to achieve an Energy Performance Certificate (EPC) rating of C, thanks to Ed Miliband's net zero drive. It all comes as the Welsh government has given the green light for councils to pass an overnight visitor levy, which will leave a family of four spending an extra £72.80 in tax for a two-week stay. Fewer families and shorter stays The problem is fewer families are going on holiday in Wales and those that do aren't staying for long. Of the nearly 70 million people who visit Wales each year, around 90pc are day trips. Since 2022, there has been a 29pc decline in overnight stays, according to data from the Welsh government. Holiday spending is also down by 10pc in the same period. Although Pattinson has in recent years managed to reach the 182-night benchmark, he says the stress of the job and the diminishing returns means he will have to give up one of the cottages. 'We are able to make between 185 and 190 days, but what that means is I can never take my eye off the ball. I can never sit back and relax. My accountant tells me each one of those cottages provides £35,000 spin-off benefits to the local economy. Now I've shut one of them down, that's £35,000 gone straight away. If you multiply that out over what's happening in the rest of Wales, that number starts to build up.' It appears Pattinson's thesis is correct. Although the number of holiday let owners exiting the market is difficult to measure, the Welsh government's recent survey of tourism businesses found 39pc said they had fewer visitors in the last year compared with a year earlier. Tourism provides one in 10 jobs in Wales, contributing £3.8bn to the economy each year. According to Pasc, there are around 22,000 self-catering businesses in Wales. A recent survey of Welsh members found that almost half (47pc) of properties that pay council tax because they don't meet the 182-day requirement were operating at a loss. Pattinson believes the biggest mistake the Welsh government has made is to take a one-size-fits-all all approach to its policies. 'It's lazy policy-making. If I lived in Newport or Tenby, I probably wouldn't have to get out of bed to make 182 days, but I'm only four miles out of Newport and the numbers fall off almost like a cliff when you are not in those hotspots.' 'It's harming the Welsh economy' Julian Barnes, a retired glass manufacturer from Bodfari in Denbighshire, north Wales, is far away from the traditional tourism hotspots. 'The best we've ever managed was 127 days in the year after Covid.' He says the idea that his end-of-terrace cottage in the rural village home to 500 people will be let for 182 nights is a fantasy. 'They want to introduce a visitor levy, an EPC requirement, there's registration, employment rights, statutory licencing – a whole pile of things that are growing to make it more and more difficult to run what was a simple business that brought in a lot of trade to the village.' It means Barnes has resigned himself to paying double council tax on the property, which recently rose to a 150pc premium in April. 'The total bill is £4,956 for 42 sq m. The council tax premium for us means we are paying £118 a sq m in tax.' He says last year the cottage brought in £10,000 in revenue which left him and his wife, a retired midwife, with a £3,000 profit. This year, he expects they'll be lucky if they end up with £2,000 after their fixed costs rose by 25pc. He adds: 'That assumes we do all the cleaning, gardening and maintenance for free. We take at least five hours to turn the cottage around. If it was paid per hour, it would be around £1 an hour – you can forget your minimum wage. The Government talks about working people, well we are working people except we are working for basically nothing.' Barnes and his wife are planning to sell the cottage. He says: 'There are groups of us all over the country in dire straits with these businesses and it's harming the Welsh economy. 'One of the big attractions of our cottage is you can walk to the village pub. We reckon we bring about £10,000 worth of business to the pub each year. There are four of us in the village who have holiday lets. If we go, that's an awful lot of money for a rural business to lose.' 'I am absolutely trapped' But while some holiday let owners are deciding to get out, others who rely on it as their main source of income feel trapped. Nicki Robinson, 61, a former cattle farmer from Carmarthenshire, turned her old dairy into a holiday cottage in 2006 after her farming business was no longer financially viable. Almost 20 years later, she can see the same process happening again as her holiday let business struggles to stay afloat. 'I am absolutely trapped. 'If I don't achieve 182 days, the daft thing is you are not earning as much but you've then got to suddenly find an extra £3,000 to pay council tax. 'It's not because you are not trying. The cottages are up 365 days a year but we just can't achieve that level of occupancy because we are not near beaches, castles or other tourist attractions. It's simply clean accommodation with a rural outlook.' Robinson says it's not just government policy that has harmed the industry. 'When I started, I got so many of my bookings direct through the tourism office and I would have families come and stay for up to 10 days at a time. 'Now bookings come through online sites that take 25pc of the revenue and the stays are so much shorter. I recently had a run of stays where I did five changeovers in seven days. 'Rather than getting families, we are seen as an alternative to a budget hotel. Bookings come in at the last minute and people want to stay for one or two nights. 'In effect, I am working every day of the year for a job that pays less than minimum wage.' The Welsh government has said its policies against holiday let owners are designed to help local people get on the housing ladder but Robinson says this is completely misguided. 'I've got a 26-year-old son who is desperately trying to get on the property ladder. But you don't fix the lack of affordable social housing by trying to destroy the livelihoods of those who rely on tourism.'
Daily Mail
19-07-2025
- Business
- Daily Mail
Chancellor's tax raid spells last orders for rural pubs
Thousands of struggling village pubs could be forced to close next year because of a punishing tax raid by Labour. Bosses have warned that the Government must intervene to stop smaller taverns, which are vital to rural communities, from being dragged into paying business rates for the first time. This extra tax burden could be the 'last straw' for many venues and could see villages bereft of their local boozer, said Chris Jowsey, the boss of Admiral Taverns, which runs 1,600 community pubs across the UK. Meanwhile, TV star and landlord Jeremy Clarkson, pictured inset, told The Mail on Sunday the looming tax raid had left publicans 'like Butch and Sundance at the end of the movie – taking fire from absolutely everywhere'. Business rates are a levy based on the notional rental value of a commercial property, meaning High Street shops and pubs often pay a premium compared with online giants such as Amazon. But 38 per cent of pubs in England and Wales – or 15,000 venues – currently pay no business rates, as their property values are too low. However, they could be forced to pay the levy from April 2026, as an upcoming review will see these values reassessed. This is because the valuations are calculated on a pub's sales, which are likely to have risen as the price of a pint has soared since the last review almost a decade ago. It will pile even more pressure on taverns, which are already struggling with higher energy costs and paying more for staff after Chancellor Rachel Reeves increased the minimum wage and National Insurance Contributions for employers in her Autumn Budget last year. Jowsey has called on Labour to raise the threshold for business rates, so that properties with an estimated rental value of £17,000 a year would be exempt – up from £12,000 a year, in line with inflation over the past decade. This would protect the most vulnerable venues from being whacked with rates bills, which he estimates could be £6,000 a year for the average tavern. Jowsey said: 'The Government is sleepwalking into a crisis for England and Wales' much-loved community pubs, as punitive business rate increases threaten their viability. This means many of these pubs will be dragged into paying business rates for the first time, even if their profits are falling.' He added: 'Unfortunately, this may be the final straw for many hard-working licensees and their pubs, depriving communities of vital social amenities that help overcome loneliness and isolation.' Jowsey said he was alarmed that despite the looming decimation of Britain's pub sector, he could not 'see anyone in the Government talking about this'. He is concerned it will accelerate the closure of pubs, which would 'do a lot of damage' to the country's social fabric. He said: 'If Westminster acts, we call on the Welsh Government to follow suit and protect Welsh pubs too.' An industry forecast last week showed that one pub could close every day this year across Britain. It comes after Britain's hospitality industry was hit by a £500 million-a-year rise in business rates in April alongside a barrage of other costs imposed by Labour. Before the Budget, small businesses had called for a Covid-era discount of 75 per cent on business rates to be extended to give them breathing space. But the Government cut this to a 40 per cent discount, capped at £110,000 per pub. Kate Nicholls, the chair of industry group UK Hospitality, said the Government should 'deliver permanently lower business rates' for the sector in this autumn's Budget. Clarkson highlighted the crisis facing Britain's pub sector in the latest series of his reality show Clarkson's Farm, which chronicled the challenges faced by the former Top Gear host as he tried to reopen a derelict Oxfordshire boozer, which he has dubbed The Farmer's Dog.
