Financial support for struggling pubs and live music venues has been described as welcome but "wholly inadequate" by industry leaders, following the Treasury's announcement of business rates relief. Pubs and music venues across England will benefit from a 15% reduction in their business rates bills starting from April 2026, after sector warnings that changes introduced in November's autumn budget would trigger widespread closures and significant job losses.
Mixed Reactions from Hospitality Sector
The fresh intervention from the Treasury has been met with a decidedly mixed reaction from within the hospitality industry. While some pub bosses have welcomed the support, others have raised serious concerns about its limited scope and adequacy. Notably, other hospitality businesses including hotels, restaurants and cafes will not receive any additional support, despite facing their own challenges with soaring tax bills.
Chancellor Defends Targeted Approach
Chancellor of the Exchequer Rachel Reeves defended the decision to focus support specifically on pubs when questioned about why other hospitality operators were excluded from the relief. Speaking at the Goldsmith Arms pub in south-east London after pouring drinks for patrons, the Chancellor stated: "Pubs are different. They are a huge community asset. Seven thousand pubs closed under the last Conservative government and we've got to do more to protect our pubs."
Reeves elaborated on the government's position, explaining: "In the budget, we reformed how the business rates system worked and we put in £4.3 billion to support businesses as we start to unwind the pandemic era support. But we recognise that after the pandemic, valuations of many pubs have increased sharply and that's put pressure on pubs."
Industry Leaders Voice Concerns
Steve Perez, owner of the Casa Hotel and Peak Edge Hotel in Derbyshire, was among those expressing disappointment with the limited scope of the support. He told the Press Association: "One of our sites is seeing its business rates going up by 45%, another by 115%. It's completely unfair. Hotels and restaurants employ large numbers of people but make very little money so should also be eligible for support."
Dom Jacobs, founder and managing director of the Ardent Pub Group in London, offered a particularly critical assessment: "Rachel Reeves' latest U-turn may be welcome, but it is wholly inadequate. Hospitality continues to shoulder an excessive tax burden, and this half-measure does nothing to change that. Instead of backing a sector capable of delivering real growth and jobs, the government has once again missed the mark."
Some Positive Responses
Not all reactions were negative. Jonathan Neame, chief executive of pub firm and brewer Shepherd Neame, struck a more positive note: "I think I have been among the Government's harshest critics but it is good to see they have listened to concerns and come up with a sensible level of rates. It will take the pressure off a little bit and make a significant difference for our pub tenants."
Details of the Relief Package
Treasury minister Dan Tomlinson provided further details of the support package, confirming that property tax bills for pubs and music venues in England will be reduced by 15% in the 2026/27 financial year, followed by a freeze in real terms for the subsequent two years. This intervention is expected to be worth approximately £1,650 for the average pub next year.
Mr Tomlinson explained: "This decision will mean that the amount of business rates paid by the pub sector as a whole will be lower in 2028/29. It will also apply to music venues too. Many are valued as pubs and it would not be right to draw the line."
Background to the Intervention
The Treasury's announcement comes after intensifying backlash from industry leaders and MPs regarding impending tax increases. Dozens of Labour MPs, including Chancellor Rachel Reeves herself, have reportedly been barred by pub landlords in response to November's autumn budget measures.
In that budget, the Treasury introduced changes to business rates that included a lower multiplier for calculating commercial property tax. However, this was more than offset by the removal of a Covid-era 40% discount to business rates bills for hospitality, leisure and retail businesses, combined with new property valuations.
Warnings from Industry Bodies
Industry organisations UKHospitality and the British Beer and Pub Association had warned that without intervention, pub business rates bills would increase by an average of 15% (approximately £1,400) in April 2026. They projected this would lead to an average rise of 76% (around £7,000) by the 2028/29 financial year.
The government has also committed to reviewing the methodology used for assessing hotel property values, with hotel businesses facing a projected 115% increase in rates over the next three years. Additionally, plans have been confirmed to publish a new high street strategy to support town centres.
It should be noted that business rates are devolved matters in Scotland, Wales and Northern Ireland, meaning this relief package applies specifically to England only.
