Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to paragraph 2.43 of the Autumn Budget 2024, HC 295, published on 30 October 2024, whether she has made an estimate of the average difference in the business rate bill of a hereditament eligible for retail, hospitality and leisure business rate relief in the 2025-26 financial year, relative to the 2024-25 financial year.

Without any government intervention, Retail, Hospitality and Leisure (RHL) relief would have ended entirely in April 2025, creating a cliff-edge for businesses. Instead, the Government has decided to offer a 40 per cent discount to RHL properties up to a cash cap of £110,0000 per business in 2025-26 and has frozen the small business multiplier.

By tapering RHL relief to 40%, rather than letting it end, the government has saved the average pub, with a rateable value (RV) of £16,800, over £3,300 in 2025-26.

At Budget, the Government also announced that from 2026-27, it intends to introduce permanently lower tax rates for RHL properties, with rateable values below £500,000. This permanent tax cut will ensure that they benefit from much-needed certainty and support. The Government intends to fund this by introducing a higher multiplier on properties with rateable values of £500,000 or more, which includes the majority of large distribution warehouses, including warehouses used by online giants.

The rates for any new business rate multipliers will be set at Budget 2025 so that the Government can take into account the upcoming revaluation outcomes as well as the economic and fiscal context.