Prop-Search welcomes "decisive boost" for high street as Rates Relief threshold raised

Leading commercial property agent Prop-Search has welcomed Chancellor John Healey's Autumn Budget announcement of a major overhaul of business rates relief, describing the package as a decisive boost for high street retailers, hospitality operators and leisure businesses across the region.

Delivered in the House of Commons today - Wednesday 28 October , the Budget raises the threshold for 100% Small Business Rates Relief in England from £12,000 to £18,000 in rateable value, meaning eligible retail, hospitality and leisure properties at or below the new threshold will pay no business rates.  The tapered relief band, within which businesses receive scaled partial discounts, will rise from £15,000 to £21,000.  The thresholds had remained unchanged since 2017 despite sustained growth in commercial property values.

The Treasury estimates that the changes will take an additional 70,000 retail, hospitality and leisure properties out of the business rates system entirely, meaning approximately half of all shops, restaurants and gyms in England will pay no business rates.  Properties above the exemption threshold will see their bills frozen in real terms for two years, with any annual adjustments capped at CPI inflation and no above-inflation increases.

Samantha Jones, Associate Director and retail specialist at Prop-Search, said: "This is the most significant intervention on business rates in a decade and genuinely welcome news for the high street.”

“For too many independent retailers business rates have become the single largest fixed cost after rent, and in some cases the difference between keeping a unit open and handing back the keys.  Raising the relief threshold to £18,000 will take thousands of small businesses out of paying rates altogether, while the two-year freeze gives everyone else real breathing space to plan, invest and hire with confidence.”

“Our advice to every occupier is simple: check your rateable value now, because the difference between £17,999 and £21,001 has never mattered more."

The relief package will be funded through a series of accompanying measures, including tackling non-compliance on online marketplaces, an increase in Machine Games Duty on higher-risk machine games from 20% to 25%, and a temporary 1p supplement on businesses that have seen reductions or smaller increases in their rates bills.

In a further targeted change, vape shops and adult gaming centres will no longer qualify for certain business rates reliefs from 1 April 2027, with seaside arcades and pubs remaining protected under separate provisions.

The Budget also set out plans for greater local control of business rates revenue, with mayors receiving a share of revenue from next year and all business rates income retained locally by the end of the decade - a move the Chancellor described as a "roadmap to fiscal devolution".