Businesses Are Rubbing Their Ears Over a New Budget Blow‑up
Just when the summer sun was making everyone feel a little too comfortable, a fresh wave of business leaders has decided to fire a public tantrum at the government. Their single goal? Stop the looming inflation‑linked surcharge that’s about to splatter the commercial property market with extra costs.
The 22nd November Deadline—A Time to Hurl Back!
The 2023 autumn budget is sniffing its way onto the calendar, and the timing couldn’t be more inconvenient for landlords and tenants alike. In the past few weeks, these leaders have been shouting from the rooftops—quite literally—to skip that pesky rise.
Anthony Hughes: “This Could Crash the Whole Deal”
- Managing Director, RVA Surveyors: “The rating industry’s been watching this drama for a while, and it’s a gamble that could collapse businesses fast.”
- He worries the classic holiday rush won’t magically rescue enterprises. “It’s like a holiday fling that doesn’t stick.”
- Hughes wants clear, strong plans from the government, not a £1.5 billion looming threat on everyone’s heads.
Kate Nicholls: “Hospitals Need a Lifeline”
Chief Executive of UKHospitality slammed the idea of freezing rates and extending relief as a “lifeline” for the sector. That’s a big no‑no for a space where every pound counts.
Business Rates—The Third Biggest Bill on Your Billboard
When the revaluation kicked off in 2023, the average rise in rateability values (RV) in England and Wales was a whopping 7.1%. Now a new bump is on the horizon—almost as much as the previous national spike.
- Many business rates payers are braced for another increase.
- It’s almost as steep as the earlier jump that came into effect.
- All this while the Retail Hospitality and Leisure (RHL) relief’s “end date” might still be hovering.
Bottom line: With the autumn budget right around the corner, market players are biting their nails hoping the government will pull a quick policy cheat‑code and help keep their cash piles at least a little steadier.
Unchanged inflation means higher costs for businesses
Business Rates: The Inflation Rollercoaster
So, the headline says inflation went from 6% to 4.6% – that sounds like a miracle, right? But the reality? It wasn’t exactly a miracle at all.
What the Numbers Really Say
- Sept‑8 Inflation Stuck – The CPI sat stubbornly at 6.7% before finally easing.
- More Upslope Ahead – The predicted spike in business rates for 2024 is going to climb even higher.
- Guidance to the Treasury – This inflation figure tells the government how much the next fiscal year’s business rates should be nudged.
Three Pulse‑Racing Why This Is a Stand‑Out Inflation
- Multipliers on Max‑Out – Since the 1990 debut, the multipliers have reached the highest levels ever.
- RHL Relief Expiring – The Relief from Hardship (RHL) deal is slated to wrap up right when rates are about to increase.
- It All Comes Down to the Pence‑per‑Pound Formula – The multiplier sets how many pence you actually pay per pound of your rateable value.
Because of this, the projected rise—a product of the CPI—will be directly affected by these two twin beasts.
RHL Expansion Gone Latterly
For the 2023/24 tax bill, RHL covered 75 % of rates per property (capped at £110,000). That was part of the business‑support push in the 2022 autumn budget. It’s not tied to the inflation spike, but it will end the moment rates are set to jump.
What’s Next? The Government’s Silent Standoff
The officials are tight‑lipped about any backup or next phase. With no roadmap in the pipeline, business ratepayers are left scratching their heads: “What do I actually need to expect?”
Why This Matters, Especially for the Hospitality Sector
- UKHospitality’s Projection – Pubs, restaurants, and hotels could see tax bills soar by around £234 million.
- Add the RHL Fade‑out – With the end of RHL and other supports on the horizon, this could add a further £630 million to operating costs.
Bottom line: the next season of business rates is going to be a tough ride for UK firms, especially those in hospitality. Keep your eyes peeled – big changes are coming.
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