Draft Non-Domestic Rating (Chargeable Amounts) (England) Regulations 2026

Andrew Snowden Excerpts

Wednesday 21st January 2026 General Committees

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

It is a pleasure to serve with you in the Chair, Mr Turner, for what I think is the first time.

As the Minister outlined, the purpose of the draft regulations is to round off the otherwise larger increases in business rates, but it is important to put that in context. A short time ago, we had a general election, in which the Prime Minister said that there would be a new regime of “permanently lower business rates”. I appreciate that the Treasury is currently hiring a new business rates tax adviser, but this issue is not going away.

In Prime Minister’s questions this afternoon, my hon. Friend the Member for Rutland and Stamford (Alicia Kearns) referred to a 2,000% increase in the business rates applying to one of the pubs in her constituency. Previously, the hon. Member for York Central (Rachael Maskell) had reported that a survey showed an average increase of 41% for hospitality businesses, 44.4% for music venues and 27% for independent shops in her constituency. The body that represents the United Kingdom’s gym and health providers, ukactive, reports an average increase of 60% in the business rates for which its members are liable. The National Pharmacy Association has reported that its members are having to remortgage their homes and put their life savings into their businesses to meet the business rate increases proposed by the Government. To date, over the last 12 months, there have been a net 200,000 job losses in the retail sector, which businesses report are primarily due to increases in business rates and national insurance contributions.

It is clear that that reflects a very substantial, permanently higher rate of business rates and an unwelcome U-turn by the Government. All of us can see the practical impact in our communities, and I would bet that there is not a Member in this room who has not been lobbied by local pubs, cafés and shops about the impact that this is having on their business.

[Mr Andrew Snowden (Fylde) (Con)]

Does the shadow Minister agree that this is creating a perfect storm and that the reason so many people are getting in touch with us—many MPs on both sides of the House will have owners of pubs, restaurants and bars getting in touch with them—is that this business rates change will crystallise that? In coastal areas like Fylde, people have less money in their pockets, so there are fewer visitors to hospitality venues to start with. Those businesses already face significant cost increases because of changes to national insurance and other changes in the tax system. As a result, these 40%, 50% or 60% changes in business rates will be the final straw for many of those businesses.

[The Chair]

Order. We have an hour and a half to debate the regulations, but interventions must be a bit shorter.

--- Later in debate ---

[Peter Lamb (Crawley) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Turner. I am here replacing another Member. When they told me the subject, I said, “Great! It is the first time I have ever actually known something about the subject.” They said, “For goodness’ sake, don’t let the Whips hear you say that”—such is the time in which we live. At the risk of incurring the wrath of Members who would clearly like to get out of this room as quickly as possible, I hope I might be of service to the Government on this issue.

For almost a decade I ran a local authority that collected one of the highest levels of business rates in the country. We are seeing the second highest increase as a result of changes being instituted now—such is the consequence of having a major airport in our patch. However, I am aware that we are likely to hold a vote on this topic, so I would like to frame in people’s minds exactly what is being debated before we get to a vote.

The current system of discounts for the hospitality industry is running out; no additional money has been put forward to fund it—it was not in the Budget. Currently, these things are not done through legislation or statutory instrument, but operate through guidance, with local authorities essentially given discretionary relief and paid back by the Government. If we do not put another arrangement in place, that collapses.

The proposed system delivers a lower rate than the previous system. If Members do not vote in favour of it, a system will come into effect that has a higher level of rates for the hospitality industry—with its level of interest in this—and for businesses that are struggling at the moment than is currently the case. This is the only proposal on the table at the moment.

[Mr Snowden]

If that is the case, would it not have been better if the Government had had the foresight to put a new system in place to deal with the discounts that existed before, and made some choices about where the pounds are spent—rather than on higher welfare, maybe on supporting businesses?

[Peter Lamb]

I would be delighted to have a different system in place. In fact, I spent many years as a local authority leader, lobbying the last Government to try to do anything on that front to resolve a system that, frankly, is still Elizabethan in design and in no way reflects the changing nature of local economies. It requires a fundamental review, and I understand from the Minister that we are looking at various changes at the moment, and further measures are being put in place to support people. However, I say to Members in this room today that if this proposal goes to a vote and they vote it down, they will in practice be voting for higher rates on these struggling businesses.

A second thing will happen. During covid, I was leader of my local authority, and businesses were suddenly unable to pay business rates. The liability around business rates is such that, regardless of what we have coming in as a local authority, we have to pay that money to the Government or they will take legal action; that is technically the requirement. My largest donor was Gatwick airport—[Interruption.] Rather, my largest contributor was Gatwick airport; it has not donated any money to me at all. It suddenly found that because aviation was hit so hard, it could not afford to pay its business rates at all. We faced a situation where local authorities in the area could not make payroll under the existing system. When Members vote today, they must therefore be very clear that they are voting to bankrupt not only the hospitality industry, the retail industry and other struggling sectors, but their own local authorities. That is all I will say on that.

If Opposition Members would like to propose something else in the House, we would be more than happy to debate it. However, if this proposal goes to a vote and they vote against it, they will have voted to put a higher rate of taxation on the hospitality industry.