Welsh hospitality facing fight to avoid being taxed out

Besieged Welsh hospitality businesses are now facing substantial and potentially damaging business rates hikes after the Welsh government sidelined the sector in a new batch of rating plans.

The new proposals, coupled with the cut-off in business rates funding from Westminster, will mean that there will effectively be no support for Welsh hospitality businesses in 2026/27 unless the Welsh government acts.

This is the consequence of a new lower business rates multiplier that has been set aside solely for the retail sector, ignoring the requirements of hospitality in 2026/27. 

The lack of support will mean a typical high street pub will pay an extra £6,800 per year in business rates; a typical country hotel will see an increase of around £17,000 per year; and a city centre hotel will see nearly £50,000 extra in costs. Some of Wales’s finest accommodation attractions will see even bigger increases, damaging domestic, international and business tourism.

UKH Cymru seeks support

UKHospitality Cymru, the leading trade body for a sector that contributes £4bn to the Welsh economy and employs more than 165,000, has called on the Welsh government to extend business rates support to include hospitality. The trade association is seeking optimal support to stall any proposed legislation that could tax Welsh hospitality businesses out of existence.

It is calling for Welsh business leaders to join it in responding to the government’s consultation, which is due to close on 12 August. It has drafted a letter that businesses can add their signature to, which will be delivered directly to the Senedd. To add your signature, please visit this link.

David Chapman, executive director of UKH Cymru, says: "This is a critical issue that will threaten the very existence of pubs, bars, hotels and restaurants across the UK.

“Hospitality must, without a shadow of a doubt, be included in any and every business rates support package, if we are to avoid the sector being taxed out. Failing to recognise and implement support for hospitality would risk the Welsh government undermining its policy objectives, effectively leading to the gutting of the high street as we know it.

“We urge all hospitality businesses across Wales, large or small, to back our calls for support from government, by submitting their views to the Senedd before this crucial consultation closes on 12 August.

“It’s vital that not only Welsh hospitality business receive business rates support, but also our counterparts in England and Scotland.”

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