The government plans lower business rates multipliers for retail, hospitality and leisure businesses
The government intends to introduce permanently lower business rates multipliers for high street retail, hospitality and leisure properties (RHL) from 2026/27. To make sure this tax cut is fiscally sustainable, the government intends to fund it through a higher multiplier for the most valuable properties.
During the interim period, for 2025/26, the small business multiplier will be frozen. Together with Small Business Rates Relief, this will protect more than a million small properties from inflationary bill increases, and RHL businesses will receive 40% relief (up to £110,000 per business).
English local authorities will be fully compensated for the loss of income and administration costs resulting from these business rates measures.
Alongside the Budget, a business rates discussion paper has been published, setting out the government’s priority areas for these reforms, and inviting industry to help co-design a fairer business rates system.