Autumn Budget 2024: Reeves extends rates relief for retail and hospitality
Rachel Reeves has extended business rates relief for the UK’s hospitality and retail sectors.
In her highly-anticipated Autumn Budget statement today, the Chancellor announced a 40 per cent business rates relief for the industry, which is down from the current 75 per cent rate set to expire on 31 March.
The 40 per cent rates relief, up to a cap of £110,000 per business, will be in place through 2026.
Laying out her plans, Reeves said Labour intends to “introduce two permanently lower tax rates for retail, hospitality and leisure properties which make up the backbone of high streets across the country” from 2026 to 2027.
Reeves also announced a freeze to the small business tax multiplier next year.
Kevin Fitzgerald, UK MD at Employment Hero, said: “The 40 per cent relief on business rates for the retail, hospitality and leisure sector is light relief alongside changes to national insurance and the minimum wage, which will see more small and medium sized businesses to struggle.
“The Chancellor says she wants the Government to invest, invest, invest, but all businesses are seeing are barriers, barriers, barriers to growth.”
It comes as a number of UK business leaders have warned ahead of today’s announcement they will be forced to scale back on hiring and investment if business rates relief is not extended.
Earlier this month, trade bodies UK Hospitality and British Institute of Innkeeping sounded the alarm over a potential decline in profit margins and sweeping job cuts if the government’s saddles them with a heavier tax burden.
Tiago Veiga, chief executive at Aurum Solutions, said the extension of rates relief is “welcome, but it isn’t a silver bullet.”
Veiga added: “Proactively finding time and cost-saving solutions needs to be a top priority for the business community.
“This is particularly the case for the hospitality sector, where the persistence of manual processes makes operations a real challenge.
“Enlisting technology like automation can free up significant resources to spend on growth-generating activities and help kick-start sustainable growth.”