UK prime minister sets business-rates cut for pubs and venues

Britain's new prime minister, Andy Burnham, announced a 20 percent cut to business rates for pubs, clubs and live music venues, saying the measure was meant to support businesses under pressure from rising costs.

The cut to the local tax paid by firms is expected to save about 32,000 hospitality businesses in England around £1,100, or $1,400, a year. It is due to come into force in April 2027 and is expected to cost £100 million, or $133 million, annually. The government said reductions to tax relief for vape shops and gambling arcades would help pay for it.

Burnham, who took office on Monday, has now made three main policy announcements in three days. He previously set out a planned cap on most bus fares in England and the removal of value added tax from household electricity bills. He is under pressure to show that Labour can deliver the economic improvement it promised after winning power in July 2024 following 14 years in opposition.

During a visit to a pub in Harlow, east of London, Burnham described the business-rates cut as a first but important step. He said pubs were closing and needed support. He also said adult gaming centres on high streets could harm communities and that vape shops did not add much to community life, adding that businesses causing social harm would be treated differently.

Industry figures gave cautious support. Ian Hoskins, owner of the Ma Pub Group in Liverpool, told Sky News the announcement was welcome but still limited, and said the government should reform business rates more widely and help consumers have more money available for discretionary spending. Mark Davy, chief executive of the Music Venue Trust, called the move an encouraging first step.

The British Beer and Pub Association says pubs are closing at a rate of about one a day. The report said pubs and other hospitality businesses have faced higher energy and labour costs.

The opposition Conservative Party said any help was welcome but called on Burnham to explain how the policy would be funded. Conservative Matt Vickers told GB News that Labour had removed a previous 75 percent business-rates reduction for leisure, hospitality and retail businesses and was now offering back 20 percent without a clear funding plan.

Burnham also announced he would pause a plan for the possible early release from September of up to 6,000 prisoners, after anger that two men involved in the killing of a police officer in 2019 would be eligible. Prison overcrowding is one of several challenges facing the new prime minister as he tries to recover support from the hard-right Reform UK party before the next general election, due in 2029.

Separately, footballer turned pundit Gary Lineker was among 120 UK-based millionaires who signed a letter urging Burnham to tax them more. The letter, organised by the Patriotic Millionaires UK campaign group, said higher taxes on top earners could raise about £24 billion.