Colliers React to Business Rates Measures Announced in October Budget 2024: 140% increase for 250,000 Retail Hospitality and Leisure Ratepayers - A dismal day for the High Street.
John Webber Head of Business Rates at Colliers commented, “The Chancellor’s announcements concerning business rates today were desperately disappointing. Despite pre-election promises of business rates reform, nothing of significance was announced. There is to be no consultation, just a discussion document,and the measures announced hardly put a sticking plaster over the gaping wound rather bringing in any fundamental reform.”
And the outlook for the high street is not good either. The Chancellor said she was heading off the knife edge that the retail/hospitality/leisure sectors might face, when the 75% discount relief that sector currently enjoys, comes to an end in April 2025. She announced
A 40% business rates relief for the retail/hospitality/leisure to 2025/6 capped at £110,000 per business.
From 2026/7 two permanent lower tax rates for businesses in the retail/ hospitality/leisure industries
Freezing the small business multiplier at 49.9p
As John Webber says, “Far from heading off a cliff edge, the Chancellor’s measures potentially are driving the sector to the wall . By replacing the current 75% discount to business rate bills, with a discount of 40%, those businesses currently eligible for the relief will see their business rates bills actually rise by a massive 140% next year.
Moreover in 2026/7, despite the two permanent lower multipliers for retail/hospitality /leisure, many businesses in the sector will still see their rates bills rise significantly as a result of the 2026 Revaluation.
Through discussions with the VOA we have also learnt that these measures, together with freezing of the smaller business rates multiplier, will be funded by introducing an even higher multiplier for larger businesses (those with an RV of over £500,000.) This will include businesses in the retail, hospitality and leisure sectors too.
“So, the bigger businesses, the ones that actually create the jobs will be hit for six. I fail to see how any of these measures help the high street in the long term.
“Like the government before her, the Chancellor has failed to tackle the business rates issue. There has been no pledge for business rates reform across the board, no attempt to freeze the larger multiplier or to bring it to a sustainable level that businesses can afford, nor to tackle the business rates deserts we see in some parts of the country, nor to reform the creaking appeals system.
"Far from saving the high street we have a potential disaster looming. “
תגובות