UK’s Biggest Hotels & Holiday Parks Urge Chancellor To Implement Hospitality-Wide Business Rates Solution

In a letter to the Chancellor, more than 130 leading accommodation businesses warn that business rates hikes will present the most significant challenge to ongoing business viability, as well as impact decisions on employment and investment.

The group says that the increases are ‘not something businesses will be able to easily absorb’, and that passing costs onto guests would further add to cost-of-living pressures.

The average hotels business rates bills will increase by 115% over the next three years, totalling £205,200, according to analysis of VOA data by UKHospitality.

The group has urged the Chancellor to bring forward a hospitality-wide solution to avert looming business rates hikes.

The letter said: “Accommodation businesses in the UK – many of which are small- and medium-sized businesses – will see significant increases in their business rates bills over the next three years.
“While additional support for the hospitality sector is welcome, it’s critical that it should not only extend to pubs, but should be a whole-sector solution.

“These changes to business rates present the most significant challenge to accommodation providers in terms of their ongoing viability, and many will face tough decisions in terms of employment and their ability to invest.

“This issue will grow in severity over the coming years, as transitional relief tapers off – this is not something businesses will be able to easily absorb, while passing costs onto guests would further add to the cost-of-living pressures already greatly affecting the British public.

“As you know, there is already immense pressure on the investment case for hotel development in the UK, given heightened build costs and concerns about new tourism taxes. We therefore urge you to consider the accommodation sector when considering any support measures to address these crippling changes.”

Kate Nicholls, Chair of UKHospitality, said: “Hotels and holiday parks are the hardest hit by business rates hikes, facing 115% increases.

“As this coalition so clearly sets out – this will only have adverse impacts on employment, investment and, in some cases, business viability.

“Accommodation businesses will unfortunately have no choice but to pass these additional costs onto the consumer – which will only worsen the cost-of-living crisis and drive inflation.

“The Chancellor has recognised that hospitality needs further business rates support – it’s crucial the entire sector receives that much-needed support.”