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Andy Burnham’s tax cut for pubs, clubs and live music venues ‘won’t make any material difference’, business owners have said.
Late-night venues have been calling on the government for help after many struggled to keep their doors open due to the cost of living crisis.
Now, nearly 32,000 hospitality businesses will be offered a 20% cut in business rates from April next year, amounting to a saving of around £1,100 a year on average.
Mr Burnham said: ‘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. What we’re announcing today is just the start as we work to bring back hope across the country.’
Chef and pub owner Tom Kerridge, who has been leading a campaign to cut hospitality VAT to 10%, told BBC Radio 5 Live the business rates cut ‘doesn’t go far enough’.
‘It will come as welcome news,’ he said. ‘But £1,000 on a yearly revenue doesn’t really make a difference.
‘It shows the government are beginning to listen and has an understanding that hospitality is at the core and heart of so many communities.’
A hotel owner has said the cut to business rates ‘won’t make any material difference’ after the rates were re-evaluated and increased for some in April.
Asked about the new policy, Steve Perez, who owns two hotels, both including a pub and a restaurant, told BBC Radio 4’s Today programme: ‘Our business rates went up to about 130%.
‘So this tiny, well, obviously it’s welcome £1,000, but this won’t make any material difference to any pub.
‘And it’s interesting to know that they haven’t talked about restaurants and hotels because bear in mind most pubs these days serve food, many pubs also have accommodation.
‘And we’ve had increases in national insurance, we’ve had the EPR, the tax no one’s ever heard of – extended producer responsibility.
‘And it’s a little bit like the supermarkets putting up the prices and then saying they’ve reduced them.’
Some hospitality owners have also brought into question the number of venues the new policy will actually apply to.
Iain Hoskins, owner of Ma Pub Group in Liverpool, told the Today programme that when a 15% cut was announced last year, only one of his five venues qualified ‘because they didn’t have the word pub in their name’.
‘They were a cafe bar, which was a posh pub, but they were a pub, you know, nonetheless.’
Mr Hoskins said his bill was between £200,000 and £300,000 across his venues.
He added: ‘I don’t want to sound ungrateful, but the increases were so huge last year that now we’re sort of chipping away at some of those increases.
‘We’re not actually… getting better value than we had before. We’re still having to find extra money for these business rates.
‘But you know, it is a relief that actually some of that is mitigated quickly. 20% isn’t an insignificant figure.’
The question of VAT cuts across the hospitality industry was also raised again following the Prime Minister’s announcement.
Mr Perez said: ‘I mean, what hospitality is campaigning for right now is a cut in VAT.
‘Ireland has just cut VAT to 9%, Andy Burnham said prior to being Prime Minister he would support a cut in VAT.
‘That will make a difference. That will mean we can invest in our businesses. That will mean we can employ more people.
‘That will mean we’ll pay more corporation tax, which I think every business is happy to pay more tax if we make more money.
‘But, these business rates, we have to pay before we even open the doors.’
With the cost of overheads increasing and customers having less disposable income, data released in August 2025 showed more than one in four late-night venues – nearly 800 premises – had shut for good since 2020.
The Music Venues Trust said the move was ‘an encouraging first step’ and said they would work with the government to ‘ensure that all grassroots music venues in England are recognised and eligible’.
Emma McClarkin, chief executive of the British Beer and Pub Association, welcomed the Government’s ‘sorely needed discount’, saying it will be ‘celebrated’ by pubs across England.
No 10 said the tax cut will be funded by a review of reliefs given to businesses that ‘do not make a positive contribution to local communities’, such as vape shops.
Mr Burnham also previously pledged to raise taxes on out-of-town warehouses for online giants such as Amazon to help pay for cuts to rates for hospitality firms.
The government will look to set out further reform to the wider business rates system, including small business rates relief, at the Budget.
Mr Burnham has announced several measures aimed at cutting costs for the public and communities since entering Downing Street on Monday, which has also seen him announce plans to remove VAT from electricity bills and reinstate a £2 cap on single bus fares across England.
The 20% cut comes on top of the 15% relief announced in January.
Chancellor of the Exchequer John Healey said: ‘Pubs, clubs and live music venues are at the heart of communities across the UK.’
He added: ‘We are determined to bring hope back, give businesses the support they need and generate growth in every postcode.’
Iain Hoskins, owner of Ma Pub Group in Liverpool, said that an extra 20% relief on business rates would go some way to ‘chipping away’ at the rising cost but cast doubt on how many venues would be covered by the change.
He said when a 15% cut was announced last year only one of his five venues qualified ‘because they didn’t have the word pub in their name’.
‘They were a cafe bar, which was a posh pub, but they were a pub, you know, nonetheless.’
Mr Hoskins said his bill was between £200,000 and £300,000 across his venues.
He added: ‘I don’t want to sound ungrateful, but the increases were so huge last year that now we’re sort of chipping away at some of those increases.
‘We’re not actually… getting better value than we had before. We’re still having to find extra money for these business rates.
‘But you know, it is a relief that actually some of that is mitigated quickly. Twenty per cent isn’t an insignificant figure.’
Mr Burnham has made Scottish Labour leader Anas Sarwar a lord and minister in the Department for Business, Innovation, Science and Trade as part of a raft of ministerial appointments on Wednesday night.
Lord Sarwar was among the first to call for Sir Keir Starmer to stand down earlier this year.
Later on Thursday, Mr Burnham will meet the leaders of Scotland and Wales for the first time since becoming Prime Minister when he travels to Glasgow.
Mr Burnham backs further devolution, but both First Minister of Scotland John Swinney and the First Minister of Wales Rhun ap Iorwerth, want independence for their countries.
The former Manchester mayor said he will not be considering any referendums and is instead focused on delivering growth.
Ahead of the meetings, the Prime Minister said: ‘When I say we need good growth in every postcode, I mean every postcode across the whole of the UK.
‘Every place and every person matters.
‘I’m not focused on point scoring or discussing constitutional changes like referendums, I want practical measures to help people live well and bring back hope.’
The First Minister of Wales said: ‘I look forward to meeting the Prime Minister in Glasgow today.
‘It is fitting that we meet in Scotland, as it underlines Wales’s case for parity of powers and a fairer funding model that reflects our needs.
‘Number 10 North must not become just Whitehall with a different postcode.
‘I agree wholeheartedly on empowering communities – it’s at the heart of my politics – but decisions affecting Wales should be made in Wales, and it is for the Welsh Government and our Senedd to work with the people of Wales on how power is exercised and shared within our nation.
‘At a time when families are still feeling the pressure of the cost of living, I am also keen to discuss how our governments can work together as equal partners to deliver improvements to the lives of people in Wales.’
The Prime Minister will also be at the opening ceremony of the 2026 Commonwealth Games on Thursday.
