Budget: Business rate discount for pubs

Posted: 8 Mar 2017

Pubs are to be given a £1,000 discount on their business rates under a £435 million package of measures to help firms set to be the hardest hit by this year's revaluation, the Chancellor has announced.

Philip Hammond said 90% of pubs will see their business rate bills discounted by £1,000 this year, while local authorities will get a £300 million fund to help small firms facing the sharpest rises as part of a plan to make the revaluation in April more fair.

Faced with fury from small businesses and threatened revolt by Conservative MPs, Mr Hammond also said there is scope to reform the revaluation process to make it "smoother and more frequent".

Mr Hammond added no business losing small business rate relief will see their bill increase by more than £50 a month next year and it will also be capped in future years.

He said: "Taken together, this is a further £435 million cut in business rates targeted at those small businesses facing the biggest increases, protecting our pubs and giving local authorities the resource to respond flexibly to local circumstances."

Mr Hammond said the move to help pubs recognises the "valuable role that local pubs play in our communities".

It will be open to all pubs with a rateable value of less than £100,000.

He added that the £300 million fund for local authorities will target "individual hard cases" in their areas and will be allocated by a formula, with details due to be set out soon.

The cap for those coming out of small business rates relief will address fears that many would miss out after the scheme, which was worth £1,500 to firms, ended in April last year.

The Government has maintained that three-quarters of companies will see their rates fall or remain unchanged under the controversial changes to business rates - the commercial equivalent of council tax.

But the Institute for Fiscal Studies (IFS) has estimated firms in London will see an average rise of 11% over the next five years due to soaring property valuations in the capital, while rates in the North will fall by 10%.

It is the first rates revaluation since 2010 and Communities Secretary Sajid Javid and Mr Hammond have come under pressure to help businesses facing large rises because they are in areas where rental values have increased dramatically.

The IFS claims the revaluation will mean an additional £800 million a year will be taken out of London to subsidise other parts of the country.

Small retailers and pubs are among those who are facing the steepest hikes.

Mr Hammond said: "The Communities Secretary and I have listened to the concerns raised by colleagues and businesses about the effects of the 2017 business rates revaluation."

He said business rates cannot be "abolished", given that they raise £25 billion a year, which will be going to fund local government within three years.

But he said the Government would set out a plan for reforming the revaluation process "to avoid the dramatic increases that the present system can deliver".

"We will set out our preferred approach in due course and will consult on it before the next revaluation is due," he said.

Commercial Property News
Share Article

Grimsby News

New 299MW power station plan for South Humber Bank

Hull & East Riding News

Plans for new 5m data centre which will create 60 jobs approved

Scunthorpe News

Overseas growth is a winner for coffee specialist as it takes top spot in Fast Track rankings

Your News

Would you want your employees working from home? Read more in our Your News special report