Businesses in England are required to pay a tax to their local council based on the value of the property that they occupy – these are called business rates. In 2017 40% of pubs were handed an increase in their business rates bill – the result of which is that many have had to put up their prices for consumers to cover their rates increases, or in some cases close for good.
Pubs currently pay 2.8% of the business rates bill but only account for 0.5% of total business turnover, which is an overpayment of around £500 million by the sector each year.
The good news is that the Government has announced a discount of up to 50% for 2022/23, and is undertaking a full review of the business rates system. CAMRA has been calling for this since 2017 and we are campaigning to ensure that this review addresses the ways in which pubs are unfairly burdened.
CAMRA is also committed to working towards a fairer rates system for pubs and clubs in Scotland, Wales and Northern Ireland.
Until 2022, installing technologies like solar panels, heat recovery systems, or certain types of battery bank were counted as improvements that increased the value of a property – meaning businesses would face a tax hike for their use.
A simple change to business rates legislation, called for by CAMRA, was all that was needed to allow licensees and producers to adopt these solutions without the burden of a higher tax bill.
This type of technology is now exempt from business rates calculations, making it more financially accessible for pubs, social clubs, brewers, and cider makers to invest in clean energy.