Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what the methodological basis was for setting the proposed business rate multiplier surcharge for hereditaments above £500,000 rateable value at a level of up to 10 pence in the pound.

To deliver our manifesto pledge, from 2026-27, the Government intends to protect the high street by introducing permanently lower tax rates for retail, hospitality, and leisure (RHL) properties with Rateable Values below £500,000. This permanent tax cut will ensure that RHL properties benefit from much-needed certainty and support.

This tax cut must be sustainably funded, and so the Government intends to introduce a higher rate on the most valuable properties on 2026-27 - those with Rateable Values of £500,000 and above. These represent less than one per cent of all properties, but capture the majority of large distribution warehouses, including those used by online giants.

The rates for any new multipliers will be set at Budget 2025 and implemented in 2026-27.

The higher tax rate, when introduced, will not be set higher than 10p above the non-domestic rating multiplier. The Government is clear that this is the maximum, and it does not represent the changes that we intend to implement. It is a guardrail that offer sensible limits with proportionate flexibility, ensuring the Government can respond to future revaluations as well as the changing economic and fiscal context.