The United Kingdom carries the highest commercial property tax burden of any major economy, according to a new report from global tax firm Ryan. The findings come as thousands of UK businesses brace for a significant increase in their property tax payments in the upcoming financial year.
Global Ranking
The report, released on Monday, reveals that the UK ranks first globally for property taxes as a share of gross domestic product (GDP). Furthermore, the UK is second only to one other nation in total property tax revenues, based on the most recent comparable international data available.
Rising Business Rates
Business rates receipts are projected to climb to £37.1 billion across the UK for the 2026/27 financial year, up from £33.6 billion the previous year. This increase follows the revaluation of business rates in England, Wales, and Scotland. While the government has introduced targeted support for pubs and music venues, other sectors—particularly hotels—have voiced concerns over anticipated hikes in their property tax bills.
Alex Probyn, practice leader for Europe and Asia-Pacific property tax at Ryan, commented: “The UK sits at the very top of global rankings for property tax. That is not a marginal difference but it reflects a system where property is taxed more heavily than in any other comparable economy. The result is that business property is carrying a disproportionate share of the overall tax burden, and that is beginning to weigh heavily on investment, particularly in sectors that rely on physical assets and long-term capital.”
Drivers of Increase
Ryan’s analysis attributes the continued rise in property tax receipts to inflation-linked adjustments, policy changes, and the phasing out of pandemic-era relief measures. Mr. Probyn added: “Property taxes in the UK are the highest by international standards, and the system is designed in a way that continues to increase the yield over time. That creates a clear tension between the need to raise revenue and the need to support investment. That balance has to be addressed.”
Experts warn that the high tax burden could dampen investment plans across UK firms, particularly those in asset-intensive industries. The report underscores the growing challenge for policymakers to reconcile revenue generation with fostering a competitive business environment.
