Prime Minister Boris Johnson will increase standard retailer discounts from 33% to 50% from April.
This will apply to all pubs with a rateable of £51,000 or less and independent pubs will experience a £1,000 cut in addition to the discount.
The announcement was welcomed by UKHospitality’s chief executive Kate Nicholls, who said it was “paramount” the system be reviewed.
She said: “Rates have arguably been the single biggest barrier to growth for hospitality and a shake-up of the whole business tax system is overdue.
“UKHospitality has been pushing for a review vocally and persistently for years so it is great to see the Government listening to our message.”
Pubs are havens
British Institute of Innkeeping chief executive Mike Clist also said the measure was positive news for publicans.
He said: “Our members do more than just sell goods and services – they are a haven for the lonely and provide employment and a fantastic career opportunity for so many local people.
“They deserve the financial support that this announcement gives, to ensure that they can continue to be the vital hubs of the community that they are.”
A Treasury select committee concluded the current system was “broken”, with rates for high street businesses, such as pubs, unfairly calculated, earlier this year.
The inquiry into the impact of business rates said alternatives should be proposed in time for the 2020 Spring Statement.
Other measures announced today (19 December) that will impact pub employers include an increase of the national insurance threshold and the national living wage.
Nicholls continued: “The Government’s agenda is clearly built around supporting businesses.
"This is very welcome, not least because we know that hospitality is a vehicle by which regeneration and economic prosperity can be delivered to the UK’s high streets, seaside towns and cities across the UK.”
The speech promised “a modern, fair, points-based immigration system” that would welcome “skilled workers from across the world” to contribute to the economy.
Nicholls said UKHospitality believed an immigration system that was evidence-led and valued skills “at all levels” was integral for the hospitality trade.
She added: “A fair and managed, three-tier system at all salary and skilled levels, hand-in-hand with investment in skills and training, is a must.
“This will avoid exacerbating labour shortages, keep the economy at full strength and allow hospitality to continue its work boosting the domestic workforce.”