The UK’s hospitality sector is facing a potential £900 million financial blow when business rates relief expires in spring 2024, prompting urgent calls for reform.
Industry leaders have warned that without action from Chancellor Rachel Reeves in the upcoming budget, business rates will quadruple when relief ends on 31 March, costing the sector an additional £914 million.
A group of 170 hospitality business leaders, including the heads of major pub chains like Greene King and JD Wetherspoon, as well as representatives from high street venues such as Caffè Nero and IHG Hotels, have written to the chancellor, calling for immediate reform. In their letter, they urged the government to introduce a lower, permanent business rates multiplier for the hospitality sector across all UK nations.
UKHospitality, the industry’s trade body, has emphasised that the budget is the government’s “last chance” to prevent a significant increase in costs that could devastate the sector. Kate Nicholls, chief executive of UKHospitality, warned that the increase would lead to more closures, leaving high streets with shuttered venues and rising vacancy rates.
Business rates burden stifles growth
The hospitality sector, which includes pubs, restaurants, cafes, and hotels, has benefited from business rates relief since it was introduced in 2020 as part of the government’s pandemic response. However, with the relief set to end in just over five months, the industry is concerned about the long-term implications of a quadrupling tax burden.
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