When Prime Minister Andy Burnham stood outside the Hare Inn in Harlow and promised a 20% discount on business rates for thousands of pubs, clubs and live music venues, the move was met with cheers from the hospitality industry — and a chorus of complaints from other high street firms asking why they had been left out.
Business rates are a tax on commercial property, similar to council tax for homes. They are calculated based on a property's rateable value (its estimated annual rent) and a multiplier set by the government. Pubs, shops, offices and warehouses all pay them, and the bill can run into thousands of pounds a year. The 20% discount announced in July 2026 applies to around 32,000 pubs, social clubs and live music venues in England, saving the average pub an estimated £1,100 in the next financial year, according to government figures. The relief, worth £100m, comes on top of an existing 15% relief that was already in place for pubs and live music venues. The measure is part of a wider package aimed at easing cost of living pressures and supporting high streets, alongside a cap on bus fares and a cut to VAT on electricity bills.
“Explains business rates, who gets the 20% cut, why pubs are prioritised, and who is excluded.”
The background to this relief is a long-running debate about the fairness of the business rates system. For years, the hospitality sector has argued it is unfairly burdened compared to online retailers, which typically operate from large warehouses and pay a much lower rates bill relative to their turnover. Industry body UK Hospitality welcomed the cut, but critics say it does not go far enough and that other businesses — such as community gyms, cafes, restaurants and pharmacies — are being neglected. Ruth Dawson, who runs a community gym in Huddersfield, told the BBC her business was doing exactly the kind of work the government claims to support, but had been “left out in the cold”. Meanwhile, Community Pharmacy England said it would challenge Burnham to extend the relief to pharmacies, which do not get their rates reimbursed by the NHS in the way GP practices do.
For UK readers, the business rates system affects the health of local high streets directly. When rates rise, some businesses close or move out, leaving empty shops. The relief for pubs and music venues is designed to protect what Burnham called “the beating heart of our communities”. But for the thousands of other businesses that missed out — including many independent retailers, gyms and cafes — the question remains: who gets to be called a community asset, and who decides?
Q: Who gets the 20% business rates cut? Pubs, social clubs and live music venues in England will receive the discount from April 2027. The largest live music venues are excluded from the relief. The measure is part of a £100m package announced by Prime Minister Andy Burnham on 23 July 2026.
Q: Why are pubs getting special treatment? Burnham said the move is aimed at supporting high streets and protecting “cherished venues” that have been disappearing. The hospitality sector argues it is heavily taxed — around 35-40% of turnover goes to the Treasury — and that online warehouses pay far less in business rates relative to their turnover.
Q: When does the cut take effect? The 20% discount will apply from April 2027. It builds on an existing 15% relief for pubs and live music venues that was already in place after the 2026 revaluation.
What happens next: The government has promised a broader overhaul of the business rates system, but the details are yet to be published. Chancellor John Healey said the government remains committed to reform. Meanwhile, business groups representing gyms, pharmacies and cafes are lobbying to be included in the relief. The policy will also be funded partly by reviewing relief for businesses deemed not to make a positive contribution to communities, such as vape shops — a move that is likely to spark further debate.