Brace Yourself: Business Rates Are Getting Squeezed!
Starting 1 April 2025, the British government is turning up the heat on business owners. Business rates across England are set to climb by 5.7 %, totalling an extra £1.5 billion that will be pumped straight into local councils.
Why the Crunch?
- Halving the Discount – Retail, leisure and hospitality spots that normally get a 75 % reduction are suddenly cut to 40 %. That’s a 140 % jump on average for over 252,000 properties.
- Concrete Increase in Standard Rates – The baseline rate jacked up from 54.6p to 55.5p per £1,000 of rateable value.
- Charities Loose Shelter – Private school charities are losing their 80 % relief, costing about £70 million in extra charges.
What That Means for Small Shops and Pubs
Picture your tiny corner shop: its tax bill will leap from roughly £3,589 to £8,613—nearly double. A cozy pub? Expect a jump from around £3,938 to a whopping £9,451. Even the humble family restaurant between £5,051 and £12,122 is feeling the squeeze.
All this comes from cutting the discount from a generous £2.41 billion down to just £1.38 billion—an added hit of £1.03 billion on the tax pile.
The Net Gain for Councils
- New Income – Councils are expected to take in £27.8 billion this fiscal year, a 5.7 % rise from the previous 2024/25 figure.
- Source – Two‑thirds of this surge is thanks to the trimmed business discount for the retail & leisure sector.
Quotes From the Field
Alex Probyn, Property Tax Practice Leader at Ryan, warns, “These hikes are a heavy blow to small and independent operations, while big firms see higher rates as a disincentive to invest—clearly a roadblock to growth.”
Bottom Line
For eye‑grabbing businesses, especially the humble retailers, levers are in the government’s hand. The increased rates may feel like a fiscal ‘spring cleaning’ for the pocket. Luckily, staying informed and planning ahead can help you dodge the worst of the bumps ahead.
Keep an eye on the numbers—your future might just depend on what you do next!
