Stopping the decline of our high streets
A new approach to business rates that is fairer, more efficient and more productive.
23 January 2026
At last year’s budget, the government announced changes to the business rates system. However, following intense lobbying and push back from the pub sector, the Treasury has suggested a U‑turn of sorts could be coming.
A U‑turn on pubs’ business rates may be the right short-term move, but it won’t fix the endemic challenges facing high streets. For that, we need wholesale reform. New Economics Foundation analysis has found that spending on alcohol consumption in bars, restaurants and pubs fell by around 60% in real terms between 2000 and 2024, but the amount spent in such venues abroad has increased by 60%, also in real terms. This comes on top of the struggles that British pubs and hospitality venues are facing from higher labour and supply costs, unfair taxation and falling household purchasing power.
Taking these trends together, tinkering with the tax system will not overhaul the crises facing British hospitality. Instead, the government should use this moment to take bold action to alleviate the cost pressures these businesses and left-behind communities face, by addressing not just tax levels but the broader system of incentives. This means a new approach to business rates that is fairer, more efficient and more productive.
Image: iStock
Topics Local economies Housing & land
