Hospitality Sector Faces £129 Million Business Rates Rise Next April in England

Businesses across England face a £1.1 billion increase in business rates from April 2027, with the hospitality sector facing a £129 million rise following today’s release of September’s inflation figures, according to analysis by global tax firm Ryan.

The Office for National Statistics (ONS) confirmed this morning that the Consumer Prices Index (CPI) stood at 3.5% in September 2026, up from 3.1% in August. September’s CPI figure determines the annual uprating of England’s national business rates multipliers under the Local Government Finance Act 1988. Unless the Chancellor intervenes at the Autumn Budget on 28 October, that uprating will feed through into all five multipliers from 1 April 2027.

Property in the “Other” class, which includes hospitality, leisure, education, health, transport and utilities, faces the largest increase at £352 million. Of this, £129 million falls on hospitality, leisure and accommodation premises such as pubs, restaurants, hotels, holiday lets and leisure attractions.

Industrial property faces a £302 million increase, followed by offices at £244 million and retail at £206 million according to analysis from global tax firm Ryan. The rise comes just a year after the 2026 revaluation increased rateable values in England by 19.4%.

Alex Probyn, Practice Leader of Property Tax, Europe and Asia-Pacific at global tax firm Ryan, said: “September’s inflation figure sets the basis for a £1.1 billion rise in business rates in England next April, unless the Chancellor intervenes. The UK already has the highest property taxes of any major economy in the world at 3.7% of GDP. Annual inflation uprating adds to recurring property costs, leaving businesses with less capital to open stores, build warehouses or refurbish offices. It is those investments that create jobs and growth. The Chancellor should use the Budget to limit that increase and leave businesses with more capital to invest and grow.”

Wider reform of the system is expected at the Autumn Budget. The Government has committed to returning to business rates reform, including Small Business Rates Relief, having already confirmed a 20% cut for pubs, social clubs and live music venues from April 2027.

The Treasury is reported to be considering raising the £12,000 threshold at which small businesses pay no rates, which has not changed since 2017.

Alex Probyn added: “The test for any Budget measures will be whether it strengthens the conditions for investment and growth across the business rates system as a whole, rather than simply transferring the burden from one group of ratepayers to another.”