Across England and Wales, the ancient institution of the public house finds itself at a crossroads — not for lack of community, but for the weight of a tax system that penalises success. The UK government has commissioned expert Jerry Schurder to review how business rates are calculated for pubs and hotels, with findings due by March 2027, as 161 pub closures in early 2026 made the human cost of inaction impossible to ignore. At stake is whether a valuation method that ties a pub's tax bill to its own turnover — punishing prosperity — will finally be reformed, or whether the sector will receiv
UK launches review into pub and hotel business rates calculation
161 pubs closed in the first three months of 2026, resulting in approximately 2,400 job losses across England, Scotland and Wales.
When a pub's turnover rises, so does its rates bill.
Mark
Why does a pub's rates bill go up when it makes more money? That seems designed to punish success.
Mimi
It's the Fair Maintainable Trade measure. The idea was to tie rates to what a business can actually afford to pay based on its trading performance. But in practice, it means a thriving pub gets penalized with higher rates while a struggling one pays less. It's the opposite of how retail works.
Mark
So this review is really about whether that whole valuation method needs to change?
Mimi
Partly. But there's a bigger question underneath: whether pubs should be treated as a special case at all, or whether the entire rates system is just outdated and needs rebuilding from the ground up.
Mark
The government already cut rates by 20 percent. Why do they need a review if they're already helping?
Mimi
Because cuts are temporary patches. A review signals they're thinking about permanent structural change. And other businesses—retailers, small firms—are watching to see if pubs get special treatment while they don't.
Mark
Is 161 closures in three months actually a lot?
Mimi
It's a significant number. That's roughly one pub closing every half day across three nations. And each closure means jobs lost, community spaces gone, local economies weakened.
Mark
What happens if Schurder recommends radical change?
Mimi
It won't take effect until 2029 at the earliest. By then, more pubs will have closed. That's the real tension—the review is necessary, but it's also slow.
Il Polso
- 161 pubs shuttered in just the first three months of 2026, erasing roughly 2,400 jobs and sending an unmistakable signal that the hospitality sector is in genuine distress.
- The system's central absurdity — that a pub's rates bill rises when its business improves, unlike retail shops assessed on floor area — has created a tax structure that effectively punishes success.
- Compounding the crisis, simultaneous increases in National Insurance contributions and minimum wage obligations have made staffing so expensive that even well-run venues are struggling to survive.
- The government has offered interim relief — a 20 percent business rates cut for pubs and live music venues from April — but eligibility remains unclear and the cuts are temporary, not structural.
- Schurder's review will feed into the 2029 rates revaluation, meaning any real systemic change is years away, while opposition voices and industry groups press for faster, broader action including VAT cuts and jobs tax reversals.
Across England and Wales, the ancient institution of the public house finds itself at a crossroads — not for lack of community, but for the weight of a tax system that penalises success. The UK government has commissioned expert Jerry Schurder to review how business rates are calculated for pubs and hotels, with findings due by March 2027, as 161 pub closures in early 2026 made the human cost of inaction impossible to ignore. At stake is whether a valuation method that ties a pub's tax bill to its own turnover — punishing prosperity — will finally be reformed, or whether the sector will receive only temporary relief while structural inequity endures.
The UK government has commissioned a formal review into how business rates are calculated for pubs and hotels in England and Wales, appointing Treasury expert Jerry Schurder to lead the inquiry and deliver findings by March 2027. Landlords, hoteliers, and business owners have been invited to submit evidence — a signal that the government has accepted, at least in principle, that the current system may be fundamentally unfair.
The urgency is not abstract. In the first three months of 2026 alone, 161 pubs closed across England, Scotland, and Wales, costing around 2,400 jobs. Business rates are widely cited as a primary driver, alongside steep rises in National Insurance contributions and minimum wage obligations that have made staffing far more costly. The British Beer and Pub Association has long argued that pubs carry a disproportionate rates burden, and its chief executive Emma McClarkin welcomed the review as "sorely needed," saying the system has "ground down" pubs' ability to remain open.
What Schurder will examine is a valuation method unique to pubs: rather than being assessed on floor area like retail shops, pubs are rated using a measure called Fair Maintainable Trade. The result is counterintuitive — when a pub's turnover rises, so does its tax bill, creating a perverse incentive where commercial success becomes a financial liability.
The government has already moved on interim measures, announcing a 20 percent business rates cut for pubs, social clubs, and live music venues effective from April, following an earlier 15 percent reduction. But confusion over eligibility persists, and the Chancellor is expected to clarify details in the autumn Budget. These cuts remain temporary rather than structural fixes.
Schurder's findings will inform the next rates revaluation in 2029, meaning meaningful reform could take years to materialise. His appointment has drawn praise from the Federation of Small Businesses, though the FSB also urged the government to raise relief thresholds more broadly. Critics are less patient — the British Retail Consortium cautioned that retailers must not be sidelined, while opposition figures called the review overdue and insufficient, arguing that VAT cuts and a reversal of recent jobs tax changes are also needed to give hospitality a genuine chance to recover.
The government has commissioned a formal review into how business rates are calculated for pubs and hotels across England and Wales, signaling that the current system may be fundamentally broken. Treasury business rates expert Jerry Schurder will lead the inquiry and deliver his findings by March 2027, with the government explicitly inviting landlords, hoteliers, and business owners to submit evidence. The move comes after months of mounting pressure from a hospitality sector struggling under the weight of multiple cost pressures at once.
The numbers tell part of the story. In just the first three months of 2026, 161 pubs shut their doors across England, Scotland, and Wales. That closure rate translated into the loss of roughly 2,400 jobs. Rising business rates are cited as a primary culprit, though the sector also faces steep increases in National Insurance contributions and minimum wage obligations that have made staffing far more expensive. The British Beer and Pub Association has long argued that pubs carry a disproportionately heavy rates burden compared to other businesses, and the government appears to have accepted that argument enough to act on it.
What makes the pub rates system distinctive—and what Schurder will examine—is how valuations work. Unlike retail shops, which are assessed primarily on floor area, pubs are evaluated using a measure called Fair Maintainable Trade. The consequence is counterintuitive and punishing: when a pub's turnover rises, so does its rates bill. This creates a perverse incentive structure where business success becomes a liability. The BBPA has been vocal about this inequity for years, and Emma McClarkin, the association's chief executive, called the review "sorely needed and hugely welcome," noting that the system has "ground down" pubs' ability to stay open.
The government has already taken some interim steps. In July, it announced a 20 percent cut in business rates for pubs, social clubs, and live music venues in England, effective from April. This came on top of a 15 percent reduction announced earlier in 2026. However, these targeted cuts do not apply to the largest live music venues, and confusion persists about which businesses actually qualify for relief. The Chancellor is expected to clarify eligibility details in the autumn Budget.
The review itself will feed into the next major rates revaluation scheduled for 2029, meaning any systemic changes Schurder recommends could take years to fully implement. Schurder brings substantial credentials to the task—he previously led business rates policy at the advisory firm Newmark UK—and his appointment has been welcomed by the Federation of Small Businesses and others. Craig Beaumont of the FSB praised his "crucial heavyweight business rates expertise," though he also pushed the government to go further by raising the rates relief threshold for smaller firms across the board.
Not everyone is satisfied with the targeted approach. The British Retail Consortium welcomed the review but warned that retailers' needs must not be overlooked in the process. Opposition figures have been sharper in their criticism. Shadow Chancellor Sir Mel Stride called the review "far too late" and accused the Labour government of policies that have "left many hospitality businesses on the brink." Liberal Democrat Treasury spokesperson Daisy Cooper agreed that rates reform is "long overdue" but argued the government also needs to cut VAT and reverse recent jobs tax changes that have hit hospitality particularly hard.
The broader context matters. Last year, the previous chancellor had announced plans to scale back pandemic-era business rate discounts entirely. Combined with significant upward adjustments to the rateable values of pub properties, landlords faced the prospect of vastly higher bills. The government's subsequent rate cuts represent a partial retreat from that position, but they remain temporary measures rather than systemic fixes. Schurder's review will determine whether the government is willing to undertake the deeper structural reform that critics say the system desperately needs.
Citazioni salienti
For years pubs have paid a disproportionately higher business rates bill which has ground down their ability to keep the doors open, so this review is sorely needed and hugely welcome.— Emma McClarkin, chief executive of the British Beer and Pub Association
The review would look at a rethink of valuations so that the government can build a fairer system for the future.— James Murray, financial secretary to the Treasury
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Politics & Governance