Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether her Department has conducted a comparative assessment of how much physical retailers will pay as a result of business rates changes with online-only retailers in 2026.

We are creating a fairer business rates system that protects the high street, supports investment, and is fit for the 21st century.

As set out at Autumn Budget 2024, the Government intends to introduce permanently lower tax rates for retail, hospitality, and leisure (RHL) properties with ratable values (RVs) below £500,000, including those on the high street, from 2026-27. This permanent tax cut will ensure that these properties benefit from much-needed certainty and support.

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

Ahead of these changes being made, the Government recognises that businesses will need support in 2025-26. As such, we prevented RHL relief from ending in April 2025, extending it for one year at 40 per cent up to a cash cap of £110,000 per business. We have also frozen the small business multiplier, taken together with small business rates relief, this will protect over a million properties from inflationary bill increases.

The Government will confirm the rates for any new multipliers at Budget 2025, taking account of the outcomes of the 2026 revaluation as well as the broader economic and fiscal context.

When the new multipliers are set at Budget 2025, HM Treasury intends to publish analysis of the effects of the new multiplier arrangements.