Key facts
- UK government plans to reform business rates from April 2026 could increase bills for some London businesses by up to 20%.
- Nearly 2,000 businesses in Westminster have rateable property values exceeding £500,000.
- Heart of London Business Alliance research suggests the proposed changes would disproportionately impact businesses in the West End.
- The alliance proposes a 'Combined Business Rate' as an alternative to widen the tax base and reduce the burden on certain sectors.
New research commissioned by the Heart of London Business Alliance (HOLBA) suggests that the UK government's proposed business rates reform, announced in the 2024 Autumn Budget, could have a detrimental impact on businesses in London's West End. The government plans to provide business rates relief for retail, hospitality, and leisure businesses with rateable property values under £500,000, funded by increased rates for properties valued above this threshold, effective from April 2026.
However, HOLBA's research, conducted by local government finance experts, indicates that this shift would lead to significant cost increases for many businesses in the West End, with some London property occupiers potentially seeing their bills rise by up to 20%. The alliance highlights that nearly 2,000 businesses in Westminster fall into the higher rateable value category. Ros Morgan, chief executive of HOLBA, stated that the government has not provided an assessment of the policy's impact and urged them to drop the plans in favor of the alliance's proposed 'Combined Business Rate' system, which aims to widen the tax base and create a more equitable system.
John Dickie, chief executive of BusinessLDN, echoed these concerns, calling for a full impact assessment and reconsideration of the proposals to avoid placing a disproportionate burden on the London economy. Neil Dolan, managing director of The Crystal Maze LIVE Experience, added that the proposed changes would be a critical blow to the experience economy sector, which often requires large properties and operates on thin margins. He argued that this approach discourages investment and expansion within the UK.