Taxes paid by pubs, hotels and cinemas in Wales will fall after the Welsh government announced a 30% cut in some business rates. First Minister Rhun ap Iorwerth said hospitality, accommodation and leisure venues would receive the permanent cut in rates from April 2027. "It is about helping businesses like this to thrive, so our communities can thrive," ap Iorwerth said on a visit to a pub in Cardiff.
The cut, which will be funded by an increase in the rates paid by businesses with the highest-value properties, was welcomed by UK Hospitality Cymru. But the trade body warned businesses still faced "massive amounts of taxation coming from all areas". Business rates are collected by the Welsh government before being redistributed as direct funding to local authorities in Wales.
The government said the 30% cut would apply to small and medium-sized businesses with a rateable value below £51,000. It will be funded by "a small increase" in the rates paid by the highest-value properties in Wales, that includes some hotels and firms with large sites such as supermarkets. Ministers said this would ensure there was no reduction in the amount of funding for local authorities.
In July, Prime Minister Andy Burnham announced a 20% cut in business rates for pubs, social clubs and live music venues in England, also due to come into effect from April 2027. Wales' first minister said the 30% cut delivered on his government's "promise to rebalance the way business rates work" in order to "bring more vibrancy into our high streets". He said the change was about helping businesses "thrive", "so our communities can thrive, which is something I think people in all parts of Wales want to see".
"We've got to think, what can we do using the powers that we have? What are the most effective things that we can do with our toolkit in Welsh government? "And this is something that we're able to do now, bringing this in from April next year, which is the earliest point realistically we can do this.
This will make a difference." The 30% rate cut will replace the current 15% temporary rate cut for hospitality businesses. Finance Minister Elin Jones said this would be paid for by an increase in rates for the largest businesses to help nurture "thriving high streets" in Welsh communities. Jones said it was right that the "burden will fall on the bigger businesses, not just in the hospitality sector" to pay higher rates, amounting to around 1p in every £1.
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