Andy Burnham cuts business rates

Andy Burnham Cuts Business Rates for Pubs and Clubs

Prime Minister Andy Burnham has announced a 20% cut in business rates for nearly 32,000 pubs, clubs, and live music venues across England, starting from April next year. The move is expected to save a typical pub around £1,100 annually, according to Downing Street.

The discount will not be available to the largest live music venues, while restaurants have been left out of the relief. The overhaul of business rates will be funded through a review of reliefs for businesses that "do not make a positive contribution to local communities," such as vape shops, and a crackdown on online marketplaces that do not comply with tax obligations.

Burnham has previously pledged to lead a "cost-of-living government" and has already announced measures such as cutting VAT on energy bills and capping bus fares at £2. The latest move is part of his efforts to support local high streets and communities. According to Burnham, "This government will back the businesses that people want to see in their communities. I said I would protect pubs and local high streets – the beating heart of our communities – and that's what we will do."

Chancellor of the Exchequer John Healey described pubs, clubs, and live music venues as "the heart of communities across the UK." He added, "We are determined to bring hope back, give businesses the support they need, and generate growth in every postcode." Healey also acknowledged the struggles faced by businesses in the cost-of-living crisis, citing tax, energy, supply-chain costs, and labor as major concerns.

However, Conservative leader Kemi Badenoch has challenged Burnham to rule out raising taxes to pay for his spending plans. Badenoch asked, "Who will pay for those taxes and if he won't, we should assume it will be the same people Labour always turn to when the sums don't add up. Working people, small businesses, the people who get up early, take risks, hire staff, and try to build something."

In response to Burnham's announcement, 120 UK-based millionaires, including broadcaster Gary Lineker, have called on the government to impose higher taxes on their wealth. The "Proud to Pay" letter, organized by the Patriotic Millionaires UK campaign group, suggests that money raised from higher taxes on wealth could be used to reduce inequality, support public infrastructure, and back small businesses. Lineker said, "Paying your fair share is a basic British value, but so many ordinary people are already paying more than they can afford. Our richest people can do more and most want to."

Experts have welcomed the cut to business rates but have raised questions about how it will be funded. Dominic Curran, head of communications at Real Estate:UK, said, "What's really needed is a cut for all businesses, alongside fixing the tax rate to make bills more predictable, and changes to empty property relief that actually reflect the time taken to relet properties." Damien Clarke, head of business rates UK at Knight Frank, added, "The biggest question is how these cuts will ultimately be funded. The government has pointed to withdrawing relief from businesses such as vape shops and tackling tax avoidance by sellers using online marketplaces, but it remains unclear how much revenue this will realistically raise, or how such measures will be administered and enforced."

The government has confirmed that it will examine wider reforms to the business rates system, including small business rates relief, when the Chancellor delivers the Autumn Budget.

While the announcement has been welcomed by many in the hospitality sector, some have expressed frustration that the relief does not go far enough. Iain Hoskins, who owns the Ma Pub Group in Liverpool, said, "Only one of my five venues qualified for last year's business rates discount. They were a cafe bar, which was a posh pub, but they were a pub, you know, nonetheless." Despite this, Hoskins acknowledged that the extra relief would still make a difference, but warned that businesses are still paying far more than they did before recent increases.