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Hundreds of small and medium-sized hospitality, retail, and leisure businesses could have their business rates cut by 30% under new Welsh Government plans.
The permanent reduction will apply to premises with a rateable value of less than £51,000 from April 1 next year.
The scheme covers independent pubs, restaurants, cafés, guest houses, gyms, cinemas, and high street shops. It replaces the current temporary 15% relief scheme for food and drink businesses.
The Welsh Government stated the tax reduction will be funded by increasing business rates on higher-value commercial properties with a rateable value over £100,000.
First Minister Rhun ap Iorwerth said the tax reduction aims to support local high streets.
He said: “This 30% cut to rates for pubs, cafés, gyms, hotels and so many other local favourites is about giving those businesses the confidence to invest, grow and keep serving the communities that rely on them.
“We’re making the system work better for the sectors that bring our town centres to life.”
Finance Minister Elin Jones said ministers had taken a “balanced approach” to ensure the move is affordable while protecting overall tax revenue for public services.
Regulations for the new rates structure will be voted on in the Senedd this autumn. The exact rates multipliers will be finalized following the UK Government’s Autumn Budget.
‘A vital lifeline’
John Hurst, chair of the Federation of Small Businesses (FSB) Wales, welcomed the rates cut, which he described as a “vital lifeline for small hospitality and leisure businesses and a welcome recognition of the intense financial pressure facing the sectors”.
He described the Welsh Government announcement as an “important win” for business owners and continued: “These businesses are at the heart of our communities, providing essential places for people to meet, socialise and spend time together”.
Plaid Cymru Senedd Members Delyth Jewell, Lindsay Whittle, and Niamh Salkeld – who all represent the Blaenau Gwent Caerffili Rhymni seat – welcomed the “much-needed boost” for smaller businesses.
Mr Whittle said: “Times have been really tough for many local businesses so this help from the Plaid Welsh Government is a welcome boost.
“Small businesses, who are at the heart of our communities, were ignored by the last Labour government. So it is great to see the Plaid government helping to breathe new life into our communities.”
Ms Jewell added: “Unlike previous relief this is a permanent move so will give long term security for those businesses that are eligible. This announcement follows the setting up of a town centre taskforce by the Welsh Government that will bring new ideas to breathe new life into our town centres.”
Cai Parry-Jones, Reform’s shadow finance minister, said “moving pubs, hotels and hospitality venues into the lower business rates multiplier is a good thing”.
But he added: “Where this policy fails is that the Welsh Government isn’t paying for this rates cut, but is instead passing the bill on to bigger businesses in Wales, which employ thousands of hard-working Welsh people.
“This will make businesses in Wales less competitive than those in England, where business rates are lower, threatening future investment and putting Welsh jobs at risk.”
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