Business rates for clubs, live music venues and pubs in England to be cut by 20%
32,000 licensed premises stand to benefit, with average savings of £1,100 per year
Clubs, live music venues and pubs in England are set for a 20% cut in business tax rates as part of a new government package aimed at supporting high streets.
Prime Minister Andy Burnham, who took office on Monday 20th July, has confirmed the tax break will take effect from April 2027 , and will be funded in part by reviewing reliefs for businesses deemed to have a less positive impact on local communities, with vape shops among those cited as an example.
The measure forms part of a wider £100 million-a-year support package for high street businesses, with the government saying it will help protect venues and local communities. Full details of the scheme, including which venues will qualify, are still to be announced, with larger music venues expected to miss out. The specific funding arrangements for the policy also remain unclear.
Initial estimates suggest that around 32,000 pubs, clubs and music venues could benefit from the support, with the average licensed premises expected to save around £1,100 annually. The measure comes on top of an existing 15% business rates relief for pubs and live music venues introduced earlier this year.
The move comes after years of warnings about the future of nightlife in Britain. In January, Music Venue Trust (MVT) reported that more than half of grassroots music venues had made no profit in the previous 12 months, with 30 venues closing entirely in 2025.
The tax cut is one of several economic measures announced by the new Downing Street administration this week. Other plans include a £2 cap on national bus fares, funded by switching international climate aid grants to a loan system, and a reduction in VAT on domestic electricity bills, paid for by scrapping the proposed £1.8 billion digital ID scheme. Chancellor John Healey has also said a wider overhaul of the business rates system will be outlined in the forthcoming autumn budget.
“For too long, governments have stood by while cherished venues have disappeared from our local high streets. So today I am changing that,” said Burnham. “This government will back the businesses that people want to see in their communities. I said I would protect pubs and local high streets, the beating heart of our communities, and that’s what we will do.”
The Night Time Industries Association (NTIA) has welcomed the Government’s plans, with CEO Michael Kill commenting: “The announcement of a 20% business-rates reduction across England from April next year is a significant and welcome intervention. With a typical pub expected to save around £1,100 annually, and the government committing approximately £100 million a year to the policy, this has the potential to provide meaningful relief to businesses facing sustained cost pressures. The government is undoubtedly making the right noises.”
Others are less optimistic. UKHospitality Chair Kate Nicholls suggested that many small high street businesses hit hard by rising energy costs, the cost of living crisis and post-pandemic tax changes may not benefit from the measure, including restaurants and cafés. Meanwhile, pub stakeholders such as Iain Hoskins, owner of Liverpool’s Ma Pub Group, and celebrity chef-publican Tom Kerridge have questioned how much impact the policy will make in practice.
Speaking to The Independent , Kerridge said the move showed the government was beginning to recognise the importance of hospitality to local communities, but warned that the relief “doesn’t go far enough”, adding that a saving of around £1,000 a year would make little difference for many businesses.
The change in business rates for live music venues and pubs comes in the same month as the previous Labour government, led by Keir Starmer, outlined a new £45 million fund for more than 2,000 grassroots music businesses and projects .
The recommendations also call for “a strong and well-funded BBC” to showcase homegrown talent. The broadcaster’s future funding model is currently under review, with debate continuing over the future of the licence fee ahead of the next Royal Charter period. The BBC has also announced significant cost-cutting measures in response to financial pressures.
