The Budget is out, and we turned to Rating Director, Chris Grose for his thoughts on John Healey’s proposals.
The headlines in the 2026 October Budget on business rates were an increase in the cap for small business rate relief from £12,000 to £18,000 for retail hospitality and leisure properties; and the removal of said relief from adult gaming centres and vape shops.
There was also mention of an extension of the transitional relief supplement for a further two years to help pay for these relief changes.
There is a cap in real terms for qualifying retail hospitality and leisure properties for 2027/8 and 2028/9 along with an announcement of the multipliers for 2027/8.
Slightly more quietly it has been announced that the government will introduce a General Anti Avoidance Rule (GAAR) as soon as possible after consulting on this winter.
In a measure that will please local authorities the government have announced that they will reimburse local authorities reasonable external legal costs when they lose cases that test a point of law.
They have also announced an extension to the 2023 Supporting Small Business Relief scheme which is something I predicted would be necessary.
The introduction of a GAAR will be welcomed by local authorities however it will be interesting to see how it is implemented. The intended outcome is of course a reduction in mitigation and hopefully in due course this will lead to a review of business rates on empty properties. The current scheme does not work and is far too much of a burden on landlords and others affected who generally don’t want their properties vacant.
In a move that will please the Valuation Tribunal, fees for appeals have been abolished for the 2026 list and beyond. Whilst well-intentioned, the fees had become an administrative nightmare for the Tribunal.
The summary of responses to the Call for Evidence on Business Rates ad Investment has also been published. More on this later.
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