Sector Responds to Business Rates Cut for Welsh for Hospitality Venues

The Welsh Government has announced it will cut business rates for hospitality venues by 30% from April next year. Businesses with a rateable value below £51,000 will be eligible for the discount.

UKHospitality Cymru has welcomed the announcement from the Welsh Government, having suggested such a solution in its manifesto ahead of the Welsh elections. Analysis by UKHospitality shows that 84% of ratepaying hospitality businesses will now benefit from the cut.

However, it raised significant concerns that 16% of ratepaying hospitality businesses, often very significant employers in their local communities, will not feel the benefit.

With a surcharge being applied to properties with a rateable value over £100,000, more than 500 venues will pay even more on their business rates bills.

These are the bricks and mortar venues that typify the broken business rates system. Larger properties like coastal hotels or those in high-value areas, like Cardiff, will continue to find themselves penalised. These businesses face the same cost challenges as the rest of the hospitality sector.

Given the Welsh Government’s intent to support the sector, it should exempt hospitality venues from the surcharge to ensure the very businesses it is trying to help are not inadvertently dragged into paying higher rates.

David Chapman, Executive Director of UKHospitality Cymru, said: “The Welsh Government has recognised that hospitality and leisure businesses are suffering under a huge tax burden and I’m pleased they have acted to reduce business rates bills for the majority.

“A lower multiplier for hospitality is a common-sense solution that we put forward in our manifesto and have campaigned for extensively. I’m pleased that Ministers in the Welsh Government have taken the time to engage with UKHospitality Cymru seriously on this and to act accordingly.

“However, I do have concerns that a significant number of hospitality venues will not be eligible for support. More than 500 venues, which are significant employers, will see their rates bills rise even further, when they are straining under the same financial pressures. That just doesn’t make sense.

“Given the Welsh Government’s clear and genuine intention to support hospitality, I hope it will now make the necessary changes to this policy to exempt hospitality businesses from the surcharge to ensure no venue will see their rates increase, at the very least.

“This business rates reduction must be a downpayment on a whole hospitality solution that goes even further at the Welsh Budget and I look forward to continue working with the Welsh Government to deliver growth, create jobs and support our communities.”