- A third of firms (34%) are
worried about their business rates, the highest level since
2017.
Concern is highest in the hospitality sector (49%), with
manufacturing (44%) and logistics (43%) close
behind. In 2024, 27% of firms said
they had scaled back or cancelled premises
improvements due to the burden of business
rates. In 2025, before the budget, almost
a quarter (23%) of firms said they planned
to adjust prices due to business rates
pressure. The BCC's latest research shows more than half of
all firms (52%) currently plan to put up prices due to
rising costs.
The BCC is calling on the Treasury to rethink its plans for
business rates as anxiety about changes to the system in April
reaches record levels.
In the BCC's Quarterly Economic Survey (QES) Q4 2025, a third of
firms (34%) said they are worried about business rates. This is
the highest level since the BCC started asking the question in
the Q2 QESof 2017.
Companies cite cost pressure from
business rates as a key reason for increasing prices and delaying
expansion of their premises.
While the Government has indicated it
is considering a rethink on business rates for pubs, BCC research
shows the disquiet being felt goes much
wider.
The hospitality, manufacturing and
logistics sector face the highest levels of concern, but business
size is also a factor, with anxiety over rates highest for firms
with 10 to 49 employees (43%).
This follows BCC data from February
2024 which found that 27% of surveyed businesses said they had
scaled back or cancelled plans to upgrade or open premises as a
direct result of business rates
costs.
In a BCC survey from February
2025, 23% of respondents said that
business rates had a direct impact on
theirprices.
Kate Shoesmith, Director of
Policy and Insights at the BCC,
said:
“The Chancellor
recognised in the Autumn Budget that the current system for
business rates is broken and holding back growth. But it is
becoming increasingly clear that the changes she set out are not
balanced and leave some sectors
over-exposed.
“While news of a carve out for pubs is
welcome, there are many other smaller hospitality companies
facing an existential threat. Meanwhile at the other end of the
scale, airports and hotel chains are expected to pay millions
more.
“The first step in addressing this
must be an uplift in the level of transitional relief to offset
the huge upswing many firms are facing in their rateable values
come April.
“The Government must then deliver the
more ambitious root and branch reform of the whole system
promised in their manifesto.
“The last four years of Brexit, Covid,
rising energy bills, wars and other geopolitical crises have
pushed costs to record highs and these show no signs of
waning.
“With new employment legislation
coming down the tracks, a further inflation busting rise in the
minimum wage and continuing global headwinds, the government must
ease the burden.
“To fix business rates it should move
to annual revaluations, to remove the steep jumps in bills caused
by longer gaps, and it must adopt a single flat rate multiplier
of 40p.
“These changes would provide much
greater transparency, simplicity and fairness than the current
complex, rigid system.”
ENDS
Notes to editors:
