It’s being reported that there is “cabinet-level opposition” to the chancellor’s business rates hike, with even the prime minister admitting hospitality will struggle.
Sky News understands that the government has been warning businesses not to protest over the changes if they want to get any concessions.
“An industry insider said the government has been telling the business community if they want help, then they should take a cue from farmers, who were given a reprieve just before Christmas when the government raised the threshold for inheritance tax from £1m to £2.5m,” said the Sky report.
“But, the industry insider said the government has been telling them farmers were ‘good, fair negotiators, and didn’t make a big campaign of it, which is why they got what they wanted’.”
This, however, seems at odds with well-documented evidence that farmers brought huge tractor-led protests to the streets of Westminster, blocking streets and snarling up traffic.
“What’s really happening here is, despite the facts being completely untrue, this is government basically threatening the industry,” said Sky deputy political editor, Sam Coates, in a podcast.
“The implication, I don’t know which Whitehall department it is, but the implication quite clearly is ‘stop being so aggressive with your briefing if you want anything at all for your industry’.
“Now that doesn’t smack of a government coming at things from a position of strength to my mind.”
The chancellor may face a fight from both sides, with reports this morning of a potential backbench revolt when the Finance Bill is voted upon on Monday.
Dan Tomlinson, the exchequer secretary, met members of the British Beer and Pub Association yesterday. Afterwards, the group said the government was “in listening mode” and “open to what else can be done”. But are they just being strung along again?
Meanwhile, Jonathan Neame, chief executive of Shepherd Neame, told The Times: “I think there is a real risk that Rachel Reeves is doing to our sector what Margaret Thatcher did to the miners.”
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UKHospitality has revealed that venues will be hit with an average £32,000 a year business rates rise come April.
An increase in businesses’ rateable value does not necessarily mean that their business rates bill will go up by a similar amount, the Valuations Office Agency has emphasised.
Local councils will calculate bills by multiplying the individual businesses’ rateable value by the relevant multiplier set by the UK and Welsh governments. They will then determine whether to apply any reliefs you are eligible for.
For those seeing bill increases, reflecting many sectors’ post-Covid recovery, the government is providing a support package worth £4.3 billion over the next three years, including:
- a £3.2 billion Transitional Relief scheme, providing more generous support to the largest ratepayers, including airports and hospitality;
- a Supporting Small Business scheme, worth more than £500 million, to help the smallest businesses;
- expanding the Supporting Small Business scheme to businesses who were eligible for the Retail, Hospitality, and Leisure (RHL) relief, protecting independent pubs and shops as they transition to permanently lower tax rates. This additional support is worth £1.3 billion;
- introducing new permanently lower tax rates for eligible retail, hospitality, and leisure properties from April, funded by a new higher tax rate on properties with rateable values of £500,000 and above.
