UKHospitality responds to the budget
Business rates reform not delivered in full, with only a quarter of maximum discount offered
Wage rises, holiday taxes and steep increases in rateable values are ‘wiping out’ the 5p business rates discount for hospitality.
Additional cost and tax increases are putting further pressure on businesses and reducing job opportunities, particularly for young people.
This is all, ultimately, passed through to consumers and, as the Office for Budget Responsibility notes, is keeping inflation higher for longer.
UKHospitality said hospitality and the high street has once again been disproportionately hit, risking the creation of a ‘two-tier economy’.
New rateable values, published after the Budget and used to determine rates bills, are stark for hospitality businesses.
Hospitality remains under pressure
Kate Nicholls, chair of UKHospitality, said: “Bricks and mortar hospitality businesses are being taxed out, and they have been penalised by the broken business rates system for far too long.
“The Chancellor recognised the importance of hospitality and provided a permanently lower multiplier for hospitality businesses – reforms secured by UKHospitality.
“However, the 5p discount is only a quarter of the maximum 20p discount the Government proposed last year.
“This is particularly frustrating given changes to business rates valuations will mean that many hospitality businesses’ tax bills will still significantly rise, alongside increases to the minimum wage adding extra cost. Business tax rates for hospitality must continue to fall for the rest of this parliament.
“The Government has heeded our calls for significant transitional relief for businesses, which will mitigate the worst impacts of the revaluation.
“Hospitality remains under significant cost pressures, with the highest tax burden in the economy. We will continue to campaign for additional support for the sector, including further business rates discounts.”
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