Chancellor commits to supporting small businesses
The treasury has published a report setting out the chancellor’s plan to explore fixing sudden jumps in business rates, known as ‘cliff-edges’.
The treasury has published a report setting out the chancellor’s plan to explore fixing sudden jumps in business rates – known as ‘cliff-edges’ – that can discourage small business investment and growth. This is one option being explored in the business rates interim report.
Currently, when a business opens a second property, they lose access to all Small Business Rates Relief (SBRR), holding it back from expanding. This means that it would have to pay thousands of pounds more for opening a small outlet in the next village.
The report confirms that the government will review how SBRR can support business expansion, potentially lifting growth and living standards in the future. It comes as the chancellor sets out her intentions to go further on legislation to cut red tape and deregulation to drive growth.
‘Permanently lower tax rates’
Rachel Reeves said: “Tax reforms such as tackling cliff-edges in business rates and making reliefs fairer are vital to driving growth. We want to help small businesses expand to new premises and building an economy that works for and rewards working people.
“As announced, from April 2026, there will be permanently lower tax rates for retail, hospitality and leisure properties, including shops, pubs and restaurants. Full details will be announced at the budget on 26th November 2025.”
Kate Nicholls, chair of UKHospitality, commented: “For too long, the broken business rates system has unfairly punished hospitality businesses and I’m pleased that the government is taking action to reform it. These measures to remove punitive cliff-edges and barriers to investment are positive and will help to rebalance the system, as will the government’s commitment to lower business rates bills for hospitality businesses.”
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