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Business rate rises could mean restaurants and pubs are 'under threat'

2-minute read

Josh Hall

13 February 2017

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Pub and restaurant owners have called on the government to curb a proposed business rate rise that they say could see some outlets closing.

Heads of chains including Pizza Express, Greene King, All Bar One, and others have written to the Chancellor asking him to reconsider the change, which could see some firms’ business rates bill increase by over 40 per cent.

The bosses say the rise, which comes as a result of a new revaluation, could cost the hospitality sector up to £500 million.

Rising costs

They wrote: “Margins in our sector are already under intense pressure, due to the cumulative impact of increased wage, training, and regulatory costs, and there is a very real danger that these increases will result in a freeze in investment and a scaling back of new openings and job creation.

“We have already seen evidence of outlets closing as a result of the planned increase.”

5p on a pint

Meanwhile the Sun reports that for pubs, the increase will be equivalent to a 10 per cent rise in beer duty, potentially putting more than 5 pence on the cost of a pint.

According to the paper, one pub in Stoke stands to see its rates bill increase four-fold.

Toby Perkins, who leads the cross-party Save The Pub Group, said: “Hundreds of pubs are already struggling to survive. The government has promised on numerous occasions to reduce business rate bills for pubs and retailers.

“Ministers have ripped off businesses for too long with the most expensive property tax in Europe. They should take urgent action to reduce this tax.”

Government responds

But the government is standing firm. A statement from the Department for Communities and Local Government said: “The method of valuing pubs was agreed by the five major trade bodies and has not changed.

“Following the revaluation, three quarters of properties will see no change or even a fall in their bills, and the small minority of businesses that face an increase will benefit from our £3.6 billion transitional relief scheme.”

Have tax changes impacted your pub, cafe or restaurant? Let us know in the comments

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