Nigel Farage tells LBC business rates a 'massive problem' for pubs as 20 Labour MPs prepare to rebel
The Reform leader urged the government to look again at the spiralling costs for firms
Nigel Farage has warned changes to business rates are a "massive problem" for pubs as he urged ministers to look again at help for struggling firms.
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The Reform leader sounded the alarm over the spiralling costs, which are due to increase in the coming months.
A re-valuation of business rates means many firms - including bars and restaurants - are facing much higher bills from April.
Discounts put in place during Covid to help firms are going to be slowly phased out.
It also means that firms with larger premises, like storage companies and supermarkets, will be hit with a property tax rise.
Sir Keir Starmer told LBC earlier this week that he's looking at "further support" for the sector.
LBC's been told up to 20 MPs could be prepared to rebel over the issue and back amendments - with the finance bill coming back to the House of Commons next week.
MPs will have to vote on budget measures - including the business rates changes - for them to come into effect in April.
Earlier today the Reform leader urged ministers to look again at the changes.
He told LBC: "Clearly the business rate thing is the absolute urgent priority. Everything this government has done has hit pubs.
"Minimum wage, many people get heir first job working behind the bar at 17, 18.
"You've seen very big percentage increases in the minimum wage, the reduction to £5,000 a year that people as employers have to start paying National Insurance.
"Many work for a few hours a week... or at the weekends, they have been dragged in.
"Short term, the really immediate thing that can be done is to rethink this re-evaluation to pre-pandemic levels of business rates."
Industry bodies and lobbyists are pushing for a specific multiplier rate for pubs, as opposed to the whole hospitality industry, or an increase in the transitional relief cash fund.
In their election manifesto, the Labour party vowed to replace the business rates with a "new system fit for the 21st century".
Pubs and other bosses have told LBC they fear they may not be able to stay afloat with the end of the government help.
The Treasury has insisted the policy is not going to change, but ministers from the Department are meeting worried Labour MPs this week to hear their concerns.
Labour MP Rachael Maskell told LBC last month that something was going to have to change for MPs to support it.
She said she is "pleading with the government" to "bring around proper reform of business rates".
She added: "The business community have got many, many ideas of how that can be done in a fair and proportionate way, but certainly not one that puts such demands on businesses that traders are saying that their doors will not be able to sustain this increase."
When asked if she is seeking substantial changes to Reeves' proposals, Ms Maskell said: “It's got to be or else the high street will collapse.
"So, I really do want the engagement with ministers over the coming weeks to ensure that we do address this real pressure being placed on our high street businesses, particularly independents, are really hard hit by this."
Business Secretary Peter Kyle is said to be among those Cabinet ministers urging a fresh look, and concerned about the increases.
It comes on top of the government increasing the minimum wage, and increasing National Insurance contributions, in a bid to stabilise the public finances.
Earlier this week, Sir Keir told LBC that government discussions with the hospitality industry are ongoing about providing “further support” for firms hit hard by higher business rates.
He said: “Obviously, what’s happened is there were reductions in place during Covid which were always going to be unwound.
"At some point, the overall rates are going to be lower.
"But I accept that because of revaluation, that means that some will have their bills going up.”
He's said he will be looking at licencing rules for pubs in a bid to make it easier for them to grow, and to cut red tape.
Conservative leader, Kemi Badenoch, told LBC that the government were "all over the place" over business rates.
She's said she will scrap them for high street firms in a bid to boost the economy.
Chef Tom Kerridge also told us that the new rateable values at his Michelin-starred Coach in Marlow had risen 100% from £50,00 to £106,000, to which business secretary Peter Kyle had responded with “concern and understanding”.
He has a meeting with the Treasury about this next week.
Several pubs have announced they will ban Labour MPs from their properties in the row over rates.
The Treasury has announced £4.5billion in transitional relief to help firms adjust to the new rates.
The 40% Covid rate for retail, hospitality and leisure discount, capped at £110,000 per business, will end on 31 March 2026.
This will be replaced by a new system in which the multipliers are set 5p lower than the standard rate with no cap in financial support.
A HM Treasury spokesperson said: “We’re protecting pubs, restaurants and cafés with the Budget’s £4.3 billion support package.
"Without this support, pubs would face a 45% increase in the total bills they pay next year. Because of the support we’ve put in place, we’ve got that down to just 4%.
"This comes on top of our efforts to ease licensing to help more venues offer pavement drinks and put on one-off events, maintaining our cut to alcohol duty on draught pints, and capping Corporation Tax.”