The government is expected to reverse or soften planned increases in business rates for pubs, with an announcement anticipated within days, following growing pressure from the hospitality industry and concerns from MPs about the impact on struggling venues.
Sky News reported that ministers are preparing a change of course after a backlash to measures set out in the November 2025 Budget, which confirmed the phasing out of remaining COVID-era business rates relief from April 2026 and introduced reforms the sector argues will still leave many premises facing sharply higher bills.
No formal details have been published by the Treasury and it remains unclear how extensive any U-turn will be, how long support would last and which businesses would qualify. Industry figures and opposition politicians have also raised concerns that any fresh relief could be narrowly targeted at pubs, potentially leaving hotels, restaurants and live music venues exposed to significant increases.
Business rates are a property-based tax paid on commercial premises across the UK, with bills calculated using a building’s rateable value and a multiplier set centrally. For many hospitality businesses, the charge is a major fixed cost, alongside wages, energy and food prices.
During the pandemic, pubs and other hospitality firms received temporary rates relief, which was later reduced. The remaining relief is due to be withdrawn from April 2026 under existing plans, a change operators say will coincide with other cost pressures and could accelerate closures.
Sky News said the government is considering measures that could include short-term relief or transitional support to blunt April’s rise, as well as changes to the way bills are calculated for pubs. Regulatory adjustments, such as greater flexibility around licensing and outdoor trading, have also been discussed in recent weeks, though no package has been confirmed.
The issue has taken on heightened political sensitivity because pubs are often portrayed by ministers as community assets and a visible part of local economies. Backbench Labour MPs have been among those warning the government that higher property taxes risk putting more venues out of business.
Sir Alan Campbell, the Leader of the House of Commons, told Sky News that the Prime Minister was “actively looking at further measures to help pubs and the hospitality industry”, signalling that discussions are under way across government ahead of an expected announcement.
Emma McClarkin, chief executive of the British Beer & Pub Association, said any row-back would be “a huge win for pubs” and could “save locals and jobs”, according to Sky News.
However, figures across the wider night-time economy have warned against a settlement that focuses only on pubs. Industry groups representing music venues and late-night businesses have argued that excluding them from support risks shifting the burden onto other parts of hospitality, with consequences for employment and high streets.
Reported estimates of the potential scale of increases have varied by property type and location. The Guardian cited average rises for pubs of around 76% without relief, with some facing bills that could more than double, while hotels were reported to face average rises of up to 115%. The government has not published venue-by-venue projections alongside any prospective new support, and the eventual impact will depend on eligibility, duration and whether the underlying calculation is altered.
The Conservative leader, Kemi Badenoch, criticised the prospect of a late change, calling the rumoured U-turn “too little, too late”, in comments reported by Sky News.
The dispute adds to wider calls for structural reform of the business rates system, with trade bodies arguing that frequent short-term fixes create uncertainty for investment and staffing. Successive governments have promised to make the system fairer, but large parts of the hospitality sector say the tax still falls too heavily on bricks-and-mortar businesses compared with online competitors.
For now, operators are awaiting clarity ahead of April 2026, when the final tranche of pandemic-era relief is currently due to end. Any targeted support for pubs could ease immediate pressure for those venues, but it may also intensify lobbying from other hospitality and cultural businesses seeking similar treatment.
The Treasury has yet to confirm whether a statement will be made in Parliament or via a written update, and has not set out the cost of any potential changes or how they would be funded.