Last week, the Government announced business rates relief for eligible pubs, clubs and live music venues in England would increase from 15% to 35% from April 2027, alongside a higher maximum discount.
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While the boost for pubs was broadly welcomed, a week on, many operators have warned it must be followed by wider hospitality reforms, including a VAT cut for the entire sector.
Multiple operator Tim Skinner, who runs the Devonshire Arms in Marylebone, London, and the Kings Head in Guildford, described the cut as “genuinely welcome” but also a “missed opportunity” as it excluded restaurants, cafés and hotels.
“Coffee shops, restaurants and hotels & guest houses are facing many of the same cumulative cost pressures.
Structural reform
“Pub business rates may differ but the headwinds of rising employment costs, utilities, insurance and taxation affect us all,” he told The Morning Advertiser (The MA).
Skinner further argued that hospitality “works best when viewed as one industry, not treated in isolation”, adding he viewed it as “a signal of intent” rather than the finished solution.
He told The MA the next test for ministers would be whether they follow the business rates announcement with wider reforms, pointing to VAT as a priority.
“The Prime Minister has publicly backed bringing VAT in line with Europe and I hope we now see that support translated into policy,” he said.
“If we’re serious about protecting jobs, encouraging investment and getting Britain’s high streets growing again, hospitality needs structural reform, not just short-term relief.”
Frisco Group managing director Heath Ball also felt the relief fell short of what operators had been seeking, describing it as a “drop in the ocean”.
“The Government knows hospitality is on its knees – and this is the answer? We asked for a VAT cut. We got this,” he said. “It’s like asking one drop of water to turn a desert into a forest.”
“It doesn’t even land until next year… so how exactly is that supposed to save my business?
A token
“Maybe it’s a signal, a token while they work on something bigger. Fine. But right now, that’s all it is: a token. And tokens don’t pay wage bills.”
Ball encouraged the Government to “stop showboating” and stop treating the hospitality sector like an “ATM”.
He continued: “Year after year, Government after Government… they’re breaking this sector’s back, and then Burnham stands up and says ‘pubs are for the working classes’. That tells you everything about how out of touch he is.”
Cheshire Cat Pubs & Bars owner Tim Bird also questioned how much difference the changes would make ahead of them taking effect next April.
He noted operators currently receive 15% business rates relief, with the increase to 35% still below the 45% discount available before April this year.
“How do we know by April next year the multipliers won’t have changed upwards or the rates assessments themselves won’t have added bigger amounts?
“It’s better than nothing,” Bird told The MA, adding: “When [Burnham] drops VAT on food for the entire hospitality industry, then I might pay attention to him.”
