Speaking during the Autumn Statement today Osborne said SBRR, which is available to pubs with a rateable value of under £50,000, benefits half a million firms and means a third of small businesses pay no rates.
“Last year we gave a £1,000 discount on rates. We are increasing that help for the high street by 50% to £1,500 next year,” he said.
The Government said the 'high street discount' will apply to approximately 300,000 pubs, shops, cafes and restaurants. This is in addition to doubling SBRR for a further year, which means 380,000 firms will pay no rates at all.
He has also capped inflation on business rates at 2% from next April and confirmed there would be a full review of the structure of the rates system.
The Government will extend the transitional arrangements for smaller properties "that would otherwise face significant bill increases due to the ending of transitional rate relief".
Osborne added that the Government is backing the Welsh Assembly for a full devolution of business rates.
Regarding apprenticeships, he said from April 2016 employers will not have to pay National Insurance contributions for young apprentices under the age of 25.
This is in addition to the announcement made at last year's Autumn Statement that employers won’t have to pay NICs on under 21s from April 2015.
He also said he will expand tax relief on business investment in flood defences and provide £2bn on flood defence schemes.
View all the announcements on the PMA's live blog of the Autumn Statement here.
Reaction
The Association of Licensed Multiple Retailers welcomed the measures to support high street businesses.
Chief executive Kate Nicholls said: “We are pleased to see the Chancellor recognising the enormous contribution that high street businesses make to the UK economy and taking steps to address the disproportionate burdens that those businesses face.
“The ALMR has repeatedly called for a root and branch reform of a business rates system that currently sees pubs and bars paying 15 pence per pint in rates compared to about 1 penny per pint in supermarkets. The UK’s high streets are more highly taxed than any other property market in Europe and this is clearly stifling investment.
“Currently, the calculation of rental values is not responsive enough to provide up-to-date information. We need a much more flexible system with annual reviews linked to CPI, providing a degree of flexibility to ensure that businesses are not paying rates based on valuations that are three or four years out of date.”
The Campaign for Real Ale also welcomed the news. Head of communications Tom Stainer said: “With 31 pubs closing every week, the Chancellor’s extension of small business rate relief and an additional £500 business rates reduction for most pubs in England is great news for pub goers. Business rates are a significant burden on pubs and so these announcements will help keep pubs open, boost investment and ensure consumers continue to benefit from great pubs.
“The review of Business Rates also provides an opportunity to address the disproportionate tax burden on pub beer sales compared to supermarket beer sales.”
British Beer & Pub Association chief executive Brigid Simmonds said: "I am very pleased to see that small business rate relief has been extended for a further year today. The increase in the retail relief to £1,500 is more good news, that will benefit 64 per cent of pubs. Overall, over 70 per cent of pubs will receive retail relief.
“For pubs, the current Business Rates regime makes up ten per cent of costs. As well as getting bills down, we need to make it easier for pubs to appeal their rates bills and make the system more responsive to changing business conditions. The Government is certainly giving increasing attention to this important issue for pubs.”
“I also welcome the removal of National Insurance payments for apprenticeships for those under 25. The pub industry can create many jobs and careers for young people quickly, with around 45 per cent of the country’s 600,000 pub employees under 25. Making it easier to create more apprenticeships is good news.”