'More needs to be done': Local reaction to business rates U-turn

The reversal comes after widespread industry concern that rising business rates — the taxes firms pay on the premises they occupy — would squeeze profits and put jobs at risk. Reports suggest ministers are preparing to soften or overhaul parts of the policy in response to mounting pressure from MPs and business groups.

Business rates have been a hot topic since the last Budget, when changes to relief schemes and property valuations were expected to trigger significant increases for many firms from April 2026. Under the previous system, rateable values — which largely determine how much a business pays — had risen steeply following the latest revaluation.

Locally, traders and hospitality operators in Skegness, Boston and coastal towns have voiced fears that higher bills could hit already-thin margins, particularly for pubs, shops, cafés and holiday attractions that are central to Lincolnshire’s tourism economy. Some hospitality leaders warned that without relief, venues might struggle to survive, especially in quieter months.

The Government’s expected shift appears to focus on targeted relief for pubs and hospitality, a move welcomed by trade bodies — but campaigners argue it might leave out other local businesses, such as seaside cafés, independent shops and attractions that also face rising costs.

Business rates aren’t just a cost for companies — they’re a key source of income for councils too. Lincolnshire County Council and district authorities collect business rates and, under the current funding system, keep a share to help fund services like roads, libraries and bin collections.

More than half of councils in England reported that the uncertainty around business rates resets had made local budget planning more difficult, reflecting wider anxiety about funding stability.

Local councillor and owner of the Seaview Pub on North Parade Mark Dannatt fears the U-turn will be too late for some.

“More needs to be done for the hospitality industry to help it survive,” he said.

“VAT reduction or even VAT on profits should be a consideration now and these talks should be taking place behind closed doors.

"As venues continue to suffer for the lack of knowledge and incompetence of those in charge businesses will be forced to close their doors through no fault of their own unless its addressed now.

“Commercial sports are charged on the rateable value so this would have seen further decline on what venues could offer to their customers who visit to avoid loneliness, to meet people, to share their everyday problems and some to even keep warm at this time of year.

“Hospitality plays a vital role in keeping people in employment and pays in approximately £54 billion a year mainly in vat and related taxes making it a significant contributor to the public finances and needs to be looked at very carefully.

“I now wait with bated breath to see the outcome on a way forward that business must take to survive.”

Paul McCooey, Chair of Skegness Area Business Chamber, said the group will continue to fight for a fairer Business Rate system. He said: “The hospitality sector plays a critical role in the health of Skegness and area.

"Whilst these proposed changes will take some pressure off this sector and is welcome we will continue to argue for fundamental reform of the Business Rates system so that is can be fair to all business”

The Government is expected to set out more detail soon, and traders locally will be watching closely to see whether relief measures extend beyond pubs and restaurants to help other hospitality, retail and leisure businesses that form the backbone of Lincolnshire’s local economy.