- At Autumn Budget 2024, the government launched a consultation on transforming business rates, outlining long-term reform priorities and immediate actions. A key announcement was the intention to create a "fairer business rates system".
- In September 2025, HM Treasury published an interim report detailing the government's response to the consultation and outlining potential reforms, including exploring a new marginal tax rate system for business rates. Further reforms, including multipliers for 2026-27 and details of transitional relief, are expected to be announced in the Autumn Budget.
- As an initial reform step following the Autumn 2024 budget, Retail, Hospitality, and Leisure Relief (RHLR) was extended for a year (until April 2026), but with a reduced discount rate of 40% (down from 75%). From April 2026, a permanently lower business rates multiplier will look to be applied to RHL businesses with rateable values under £500,000. This will be funded by a higher multiplier for properties with rateable values of £500,000 or more.
- The government's long-term reform priorities include incentivising investment and growth. This includes reviewing the effectiveness of existing reliefs and a consultation on implementing a General Anti-Avoidance Rule for business rates in England. Furthermore, the government is committed to the Digitalising Business Rates project, aiming for implementation by 2028 and enabling by 2029, with a corresponding duty on ratepayers to provide property information.
- Timing: the government will provide further updates on business rates reform in the Autumn Budget. The draft 2026 Rating List is expected to be published in Q3-Q4 2025.
Resources (click to open)
- Transforming Business Rates: Interim Report (HM Treasury, September 2025)
- Transforming Business Rates (Local Government Association, February 2025)
- Business rates: forward look (HM Treasury, February 2025)
- Transforming Business Rates (HM Treasury, October 2024)
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