Author: Paul Crofts

As you are probably aware, the government’s recent activity regarding business rates has not gone down well with the hospitality industry.

The originally planned premises revaluation would have seen large increases in rateable values, and resulted in some pub’s valuations rise by an average of 32%. Over 5,000 pubs would have seen their rates at least double. With this happening at the same time as the Covid-era support being withdrawn it was a hammer blow to the industry and prompted a massive backlash. More than 1,000 pubs banned labour MP’s from their premises in protest, which prompted a government rethink. Pubs will now see a 15% discount on their rates, which are also frozen for the next 2 years. However, this is not enough support, with the phrase “sticking plaster” appearing regularly in the press.

Here’s is the reaction from CAMRA; the Campaign For Pubs; and some of our local pub operators.

Ash Corbett-Collins, CAMRA Chairman

“This short-term announcement is not the ‘permanently lower business rates’ that pubs were promised. While it is positive that the Chancellor has listened and announced extra discounts for pubs facing the threat of closure, it is short-sighted to think that today’s statement will give publicans the certainty they need.

“The plan to review the unfair way pubs are assessed for business rates is welcome, but this leaves pubs in the same situation as they have been for years – still facing a long wait for promised, and fundamental, reforms to make the system fairer.

“CAMRA will keep campaigning to get the Government to support great pubs and independent breweries so they can compete against online businesses and cheap supermarket booze.”

On changes to licensing hours and relaxation of planning rules, Ash said:

“Letting pubs stay open for longer or extending their premises is not going to solve the fundamental problem where otherwise viable businesses face being taxed out of existence. Licensees are already limiting their opening hours and can’t afford to invest in their buildings. The Government should fundamentally review the tax burden on pubs and independent breweries from things like VAT and alcohol duty to see if those systems can be made fairer, to give our locals a fighting chance against cheap supermarket alcohol.”

Dawn Hopkins, Vice-Chair of the Campaign for Pubs, and a licensee in Norwich said:

“This U-turn on the business rates betrayal and the extra relief is essential, to avoid the otherwise catastrophic hikes in business rates, but is just another sticking plaster and whilst a relief, does not address the fundamental unfairness of the business rates system to pubs and the dodgy system of valuation currently used.

“The Labour Party promised genuine reform of the whole system of business taxes and they promised permanently lower rates for pubs, so these are still two broken promises until and unless they deliver that through a new fairer system.

We are deeply disappointed that the Government has left the completely flawed and unjustifiable revaluation in place, which has produced absurd rateable values that bear no relation to the very tough reality of trading for pubs.

“Whilst we welcome a review, the fact is that Labour promised to abolish business rates, not to merely commission a review, this is kicking it into the long grass.

We are therefore calling on all publicans in England and Wales to write to their MP and make it clear that the current revaluation is wrong and that the highly dubious and unfair ‘Fair Maintainable Trade’ system of calculating pub rates must be scrapped and a new system pub in place from 2027, not 2029. Without this, the issue is not resolved so we urge them to listen and deliver the genuine reform they themselves promised”.

Paul Crossman, Chair of the Campaign for Pubs and licensee of three pubs in York said:

“We are disappointed that the Govt has not gone further on business rates and ditched the current revaluation for pubs completely while maintaining existing rateable values and reliefs for at least another year as we asked.

The new valuations are the product of a flawed methodology that has now been rightly acknowledged as unfit for purpose by the Govt.

“While the further discount and freezing of bills for three years is welcome, it cannot be right that pubs are now saddled with higher rateable values going forward when they are clearly the product of a flawed system.

“Replacing this methodology with a fair new system that actively supports pubs will now be key, and it is vital that grassroots rates-paying businesses are consulted and that this time their needs are prioritised over those of the big property-owning corporations that have exclusively influenced and shaped all pub-related policy in the past”.

Chris Bamford, Co-owner of Rutland Arms, The Crow & Harlequin

“The latest business rates saga serves to further illustrate the incredibly challenging conditions pubs, and the hospitality and retail industries in general, are currently operating in. In the budget, business rates were initially sold as being ‘cut’, which transpired to actually for most businesses be an increase, and after the partial u-turn and ‘15% reduction) for some at least is more of a temporary maintenance of the status quo. This is on top of operating costs having spiralled massively during the cost of living crisis, including tax rises and amongst the highest tax burden on hospitality in Europe, at a time when increased pressure has been put on our customers disposable income. Pubs are rightly a valuable source of income for the treasury, as well as significant employers, but a closed pub pays no tax and offers no employment opportunities.

I believe pubs are an often undervalued asset to the community, safe spaces for meeting people, giving a platform, or even just rehearsal space to the arts. In our ever increasingly digital age they give space for real human contact, and unlike supermarket bought alcohol, a regulated environment in which to drink. Too many pubs which would and should be viable if given the right support and conditions have closed already and more will follow. We need a review of Business rates and tax on hospitality to restore balance versus supermarkets and to ensure pubs can continue to thrive as hubs of the local community. The pub should be celebrated for its positive contributions to society, rather than targeted as a cash cow.”

Sean Kelly, Director, True North Brew Co.

“While the latest business rate changes are welcomed, more is required—for operators in the industry we feel too small and too late to counter years of mounting pressure. The mechanics of the discount have not been released, and while the government have a way of spinning it as positive, the reality on the ground is that it doesn’t go far enough and should include all hospitality venues, not just parts of the sector. What’s really needed is a full revamp of the rates system so it reflects modern trading conditions and supports community venues properly. Ultimately, if the aim is to protect pubs, bars and the wider hospitality ecosystem, a meaningful VAT cut is the game changer that would make the biggest and fastest difference.”

Toby Grattidge, Co-Managing Director, Abbeydale Brewery & Rising Sun pub.

“Our rateable value at the Rising Sun has increased by a staggering 70% since 2023. Over the last 6 years, the changes to the tax regime have been relentless in hitting pubs – while we wholeheartedly support staff getting paid a good wage, when coupled with increases to national insurance, raw material costs and beer duty it can make it feel as though there is no light at the end of the tunnel. 

We feel very fortunate at the Rising Sun to be a thriving pub with the support of our community, as well as financial support from the brewery behind us, meaning we’re aware we’re as well placed for survival as it’s possible to be – but if this approach to taxation continues there won’t be an industry left to tax. It’s increasingly difficult for pubs to be a viable business model, and this of course results in a direct impact on the brewery itself too. We are committed as a business to doing all that we can to be there and offer the best possible quality, value and service to our customers and lobby the government to consider the vital community assets that pubs are.”