On Tuesday 10 December, Senedd Cabinet Secretary for Finance Mark Drakeford announced a continuation of the 40% business rates relief for hospitality firms as part of the Welsh Government’s draft Budget for 2025-2026.
UKHospitality (UKH) Cymru executive director David Chapman said: “Continuing 40% business rates relief for hospitality businesses was absolutely critical and I’m delighted the Welsh Government has listened to and acted on our calls for an extension.
“Rates relief will continue to be a lifeline for many Welsh hospitality businesses, particularly as venues have to pay significantly increased employer taxes from April.
“Crucially, this extension avoids a situation where Welsh businesses could have been left at a competitive disadvantage to the rest of Great Britain.”
Positive step
In addition, the Welsh Government introduced a 1% increase to the multiplier, which Chapman added was “another positive step”, particularly for businesses that don’t fully benefit from relief.
“I’m grateful the Welsh Government has used the funding available in this way. These measures are recognition of the role hospitality plays serving Wales and creating places where people want to live, work and invest.
“I hope we can continue to work with the Welsh Government to create the conditions that allow our businesses to fulfil their ambitions to drive economic growth and create more jobs”, he continued.
Data from UKH Cymru, published ahead of the Budget, estimated a local pub would have seen its rates bill increase by almost £5,000 next year without relief, with rates £5,400 higher than an English equivalent.
According to the figures, the Welsh Government has allocated an additional £1.5bn to “strengthen public services, support small businesses and drive economic growth” in the £26bn Budget for next April.
Long-term reform
In October, Chancellor Rachel Reeves gave the Welsh government an extra £1bn to spend in this Budget.
Welsh Beer & Pub Association (WBPA) CEO Emma McClarkin said: “We have been loud and clear that the Senedd needed to maintain the vital business rates relief, which so many pubs rely on to counter the soaring cost of business they face.
“We welcome Government heeding our warnings in this draft Budget and this relief, which amounts to £4.3m, should bring pubs across Wales a much-needed sigh of relief and confidence to keep investing.”
However, McClarkin added it was “concerning” the Budget did not mention wider rates reform.
She continued: “We continue to call for them to commit to meaningful long-term reform which will allow pubs in Wales to carry on pouring hundreds of millions of pounds into the economy and supporting tens of thousands of jobs.”
