Thank you for your interest in this story
To continue reading this article, subscribe to the Stray Ferret for as little as £1 a week
Already a subscriber? Log in here.
23
Jul
Business rates cut welcome — but system needs reform, says Ripon BID
Local hospitality groups have welcomed today’s (July 23) 20 per cent reduction in business rates — but said the whole rateable value system needs overhauling.
New Prime Minister Andy Burnham announced pubs, clubs and live music venues in England will receive the cut in April next year. The move is expected to save a typical pub £1,100 in taxes a year.
Lilla Bathurst, manager of Ripon Business Improvement District, which represents firms in the city, said the Black Swan, the Water Rat and the One Eyed Rat would particularly benefit because their business rates had more or less doubled over the last year so they would be able to recoup some of the impact of this.
But she added:
We welcome this sticking plaster but it doesn’t go far enough. The whole system needs overhauling so we don’t have this constant uncertainty. Successive governments have said they will reform business rates but none of them have.
Ms Bathurst questioned why business owners did not know how their rates are calculated.
And she called for the 10% VAT rate introduced during covid to be brought back to help hospitality businesses cope with rising costs.
'Clearly positive'
Jay Smith, who owns Montey’s bar on The Ginnel in Harrogate, said any reduction in business rates had to be welcomed, adding:
For independent hospitality businesses, rates are one of the biggest fixed costs we face, so a 20% reduction is clearly positive in principle.
That said, operators have become used to looking beyond the headline. We’ll need to see exactly how the scheme works and who qualifies before businesses can understand the real impact on their bottom line.
The important thing is whether this leaves venues in a stronger financial position than they are today. If it genuinely reduces costs without simply replacing reliefs that were already due to end, it will be a meaningful step in the right direction.
Mr Smith said the hospitality sector had seen “significant changes to business rates” in recent years, “so operators will inevitably judge the policy on what actually arrives on their bill rather than the headline percentage”.
He added:
“Hospitality doesn’t need headlines — it needs certainty. If this delivers a genuine reduction in operating costs, businesses will welcome it. The detail will ultimately determine whether today’s announcement becomes a meaningful saving or simply a good headline.
“After three decades of running an independent venue, I’ve learned that it’s the final bill, not the headline, that matters.”
Prime Minister Andy Burnham said today’s policy was a sign that his government will "back the businesses that people want to see in their communities".
Business rates are charged on most non-domestic properties based on their rateable value, which is calculated by the Valuation Office.
Local councils then multiply this value it with a figure called the "multiplier" to produce the final rate.
1