In their election manifesto, the new government gave a commitment that the current business rates system would be replaced with a new fairer system that would level the playing field between high street businesses and online giants.
Similar pledges have been made before by previous governments and it was pleasing today that the new government have taken a first step and announced that changes will take place in April 2026. These changes will include:
- The introduction of two permanently lower multipliers for retail, hospitality and leisure (RHL) properties with a rateable value (RV) under £500,000.
- To fund this sustainably via a higher multiplier on properties with RV of £500,000 and above, which includes the majority of large distribution warehouses including those used by online giants.
The new multipliers will be announced in next Autumn’s Budget in advance of their introduction in April 2026.
The government have also announced that it will enter into a consultation with interested parties up to March 2025 with a view to introducing further reforms to the current system.
One disappointing announcement is that rather than simply keep the current 75% reduction in business rates for RHL properties for the 2025-26 year, the relief will be reduced down to 40% (subject to the current cash cap of £110,000 per business).
Please click here to go back to our full Autumn Budget 2024 analysis.
