Business rates will be cut by 20% for pubs, clubs and live music venues across England from April next year, Prime Minister Andy Burnham has announced.
It comes amid a series of measures that his Government has brought in to provide “breathing space” to the public and businesses as they experience cost pressures.
The discount, which comes on top of a 15% cut announced in January, will apply to around 32,000 hospitality businesses.
It is expected to save a typical pub some £1,100 annually, but will not be available to the very largest live music venues.
The move will cost around £100 million a year and funds are planned to be raised for it by cutting business rate relief for vape shops and cracking down on online businesses that fail to pay VAT.
The Prime Minister said it was time to support vanishing “cherished local spaces” with his business rates reduction.
He wrote on X: “I’m giving thousands of pubs, clubs and music venues a 20% cut in business rates.
“I won’t stand by while these cherished local spaces disappear, replaced by boarded-up windows and ‘For Sale’ signs.
“They’re the heart of our communities and it’s time we backed them.”
Since entering Downing Street on Monday, Mr Burnham has unveiled plans to remove VAT from electricity bills and reinstate a £2 cap on single bus fares across England.
Chancellor John Healey meanwhile vowed to back UK businesses that have “felt really squeezed” and said he was “just as concerned about the cost of business as I am about the cost of living”.
Addressing business leaders in central London on Thursday, Mr Healey said: “My message to British businesses is quite simple: to British businesses, to British innovators, to British investors: I will back you as your Chancellor, and I’ll back you in financial services, in technology, in retail, in industry, in all parts of the economy.”
Chancellor John Healey said he is ‘just as concerned about the cost of business as I am about the cost of living’ (Yui Mok/PA)PA WireLike households, firms have been feeling a “lack of a breathing space”, he said.
Chief Secretary to the Treasury Emma Reynolds insisted the policy is fully funded, despite both sources of revenue being described as subject to review or consultation.
Read More
She told Sky News: “There may be additional measures that we look at as well, but it is those two principal ways that we’re going to fund this business rate relief.”
Speaking to LBC, Ms Reynolds said vape shops were being targeted because they cause “social harm” and online firms were failing to comply with their tax obligations.
She said: “At the moment, vape shops, like other shops on the high street, get business rate relief.
“We don’t think that is fair because these businesses do cause social harm.
“So we will look to raise some revenue by reviewing that relief, and then also on the VAT, online businesses are often charged VAT, but they’re not paying that VAT.
Chief Secretary to the Treasury Emma Reynolds said cutting rates relief for vape shops was being looked at as they cause ‘social harm’ (Aaron Chown/PA)PA Wire“They’re sort of getting around the rules. So we’ve got a consultation out on that at the moment about how we fix that, and that would also raise some revenue.”
The Conservatives said Mr Burnham must detail how he will pay for his policies.
Tory shadow business secretary Andrew Griffith said: “Whilst any support for Britain’s hard-pressed businesses is welcome, once again this Government has been found wanting on both the detail and funding for this policy.”
The changes were largely welcomed by the sector, but some businesses questioned how much impact they would have, while those not covered called for further help.
The Music Venues Trust welcomed the move as “an encouraging first step” and said it would work with the Government to “ensure that all grassroots music venues in England are recognised and eligible”.
The British Beer and Pub Association said it was “delighted” and was eager to look ahead to “permanent business rates reform”.
Prime Minister Andy Burnham has seen his approval rating jump, according to polling (Toby Melville/PA)PA WireButlin’s chief executive Jon Hendry Pickup said: “We’re one of the largest employers in the communities this Government wants to support, investing in UK tourism and creating jobs in coastal economies.
“Businesses and resort operators making that contribution shouldn’t be overlooked simply because of their size.”
Ros Morgan, chairwoman of the Real Rates Reform Alliance, said the move was encouraging but urged further measures be taken at the budget.
She said: “Targeted support for a small number of sectors is not a substitute for fundamental reform.”
No 10 has said it will look to set out further reform to the wider business rates system, including small business rates relief, at the budget.
Meanwhile, the Prime Minister’s approval rating has jumped 10 points in a week to plus-13, polling from More in Common showed.
It means Mr Burnham has surpassed his predecessor Sir Keir Starmer’s post-election high of plus-11.
Mr Burnham announced a raft of ministerial appointments on Wednesday night, including Scottish Labour leader Anas Sarwar, who has been made a lord and minister in the Department for Business, Innovation, Science and Trade.
Lord Sarwar was among the first to call for Sir Keir to stand down earlier this year.
Later on Thursday, Mr Burnham will meet the leaders of Scotland and Wales for the first time since becoming Prime Minister when he travels to Glasgow.
Mr Burnham backs further devolution, but both First Minister of Scotland John Swinney and First Minister of Wales Rhun ap Iorwerth want independence for their countries.
The former Greater Manchester mayor said he will not be considering any referendums and is instead focused on delivering growth.
Ahead of the meetings, the Prime Minister said: “When I say we need good growth in every postcode, I mean every postcode across the whole of the UK. Every place and every person matters.
“I’m not focused on point scoring or discussing constitutional changes like referendums, I want practical measures to help people live well and bring back hope.”
Rhun ap Iorwerth is First Minister of Wales (Lucy North/PA)PA WireMr ap Iorweth said Scotland was a fitting location to meet “as it underlines Wales’s case for parity of powers and a fairer funding model that reflects our needs”.
The Prime Minister will also be at the opening ceremony of the 2026 Commonwealth Games on Thursday.
He is expected to meet with the First Minister and deputy First Minister of Northern Ireland on his tour of the United Kingdom in August, where he will visit places across England, Scotland, Wales and Northern Ireland.