100% business rates relief in 2020-21 for 45% of properties

Read our legal insight to find out more about the changes, and what the government is proposing in the longer-term.

What changes will we see?

It had already been announced that the business rates retail discount for properties with a rateable value of below £51,000 in England was to be increased to 50% in 2020-21, and would be expanded to include cinemas and music venues. In the budget, the Chancellor acknowledged the additional support required by small businesses in response to COVID-19 and announced a further increase to 100% for 2020-21. The leisure and hospitality sectors will also benefit from this 100% ‘business rates holiday’.

The budget sets out that these temporary measures, taken together with existing small business rates relief, mean that around 900,000 properties, or 45% of all properties in England, will receive 100% business rates relief in 2020-21.

Pubs with a rateable value of over £51,000 will also see some additional support. The government had also already announced the introduction of a £1,000 Business Rates discount for pubs with a rateable value below £100,000 in England for one year from 1 April 2020. This is being increased to £5,000.

Whilst retailers, leisure operators, and their landlords, will welcome these changes, already struggling local authorities are not going to view them in such a positive light. It is clear that further long-term change is necessary.

What will the future bring for business rates?

A more wholesale review of business rates is on the cards. The government published terms of reference alongside the budget and has stated that a Call for Evidence will be published in spring 2020, with a report due by autumn 2020.

We will be monitoring and reporting on developments.

Contributor: Alexandra Holsgrove Jones