High street shops, pharmacies and music venues have called on Rachel Reeves to axe the looming increases to business rates for them as well as pubs.
The government is expected to announce a climbdown on the increases to business rates bills faced by pubs in England in the coming days.
Landlords and pub owners have been fiercely critical of the impending hikes, with more than 1,000 pubs banning Labour MPs from their premises.
But other lobby groups and backbench MPs have urged the government to widen the relief, saying many other kinds of businesses will not be able to pay the higher bills.
In her November Budget, the chancellor scaled back business rate discounts that have been in force since the pandemic from 75% to 40%, and announced that there would be no discount at all from April.
That, combined with big upward adjustments to rateable values of pub premises, left landlords facing the prospect of much higher bills.
The understands the climbdown will apply only to pubs and not the whole hospitality sector.
The British Independent Retailers Association (Bira) questioned why its members -– which include high street shops, restaurants and cafes — would not be given the same relief.
Its chief executive Andrew Goodacre said independent retailers “face exactly the same challenges as pubs but have been left out of discussions about additional support”.
“Perhaps independent retailers need to follow the pubs’ example and start banning MPs from their premises too,” he said.
Surinder Arora, who operates a number of hotels in the UK, said a potential carve-out only for pubs was “not right or fair”.
The chief executive of the Arora Group told Radio 4’s Today programme that the business rates bill for just one of his hotels increased by £12.4m after discounts were scaled back.
“The new numbers are eye-watering,” he said, warning that the higher costs will be passed on to his customers and “belt-tightening” was inevitable.
While Arora said he supported the chancellor’s growth ambitions, higher taxes mean “instead of expansion, we could be going the other way”.
The British Retail Consortium (BRC) said the current business rates system “is not fit for purpose”.
Helen Dickinson, the BRC’s chief executive, said: “This latest announcement looks like another sticking plaster on a broken system rather than the more fundamental reform required.”
Jon Collins, chief executive of music venue body LIVE, said: “If the government is preparing a U-turn on business rates for pubs, it must not leave live events and arenas behind.”
The National Pharmacy Association chief executive Henry Gregg said the sector could face a 140% increase in rates, while the lobby group for gyms, pools and leisure centres said those businesses faced potential rate increases of 60%.
“Failure to provide a business rates support package to gyms, pools and leisure centres will lead to higher prices, reduced services, redundancies and in some cases the loss of gyms from our communities,” chief executive of ukactive Huw Edwards said.
Some of those lobby group concerns were echoed by MPs.
“Venues, clubs and cinemas up and down the country are already struggling for survival,” Conservative MP Dame Caroline Dinenage wrote to the chancellor on Thursday.
She said the planned rates reforms risk “pushing many over the edge”.
“The Treasury needs to be open about how it decided on the changes, while the sector desperately needs more details on the alternative support promised by the Prime Minister.”
Reeves said earlier this week that the government had reduced the rate of tax on pubs and hospitality, but the Independent Valuation Office increased what they saw as the value of those properties.
“Now we’re working with the sector to look at the implications of a range of policies and looking at planning and licensing,” she said in an interview with Good Morning Britain.
“I want to support our pubs; I want to support our high streets. That’s why we made the change to the rates. But I recognise that many paths are still struggling and we’re working with them.”
