An open letter to the Rt. Honourable Rachel Reeves MP, Chancellor of the Exchequer
Business Rates Change Must Go Further – Or the High Street Pays the Price
From:
Frank McKenna
Chief Executive & Group Chair, Downtown in Business
Bill Addy
Chief Executive, Liverpool Business Improvement District
Dear Chancellor,
We welcome the Government’s recognition of the pressure facing the high street and hospitality sector, including the continuation of retail, hospitality and leisure relief and the commitment to introduce lower business rates multipliers from 2026.
That acknowledgement matters, and it is a step in the right direction.
However, we are deeply concerned that as currently designed, the changes risk falling short of what is needed to protect high streets, hospitality businesses and city centres from further decline.
Without stronger safeguards, many businesses will still see higher bills in practice, driven by revaluations, cliff edges, and the withdrawal or tapering of reliefs.
The risk is clear.
If business rates change results in net increases for hospitality and high-street operators, even inadvertently, the consequences will be severe:
- Accelerated closures of restaurants, bars and independent retailers
- Job losses, particularly among younger and lower-paid workers
- Reduced investment and stalled regeneration
- Falling footfall
- And high streets drifting towards long-term vacancy and decline
Hospitality is already operating under intense pressure: 20% VAT, rising wage costs, staffing shortages and regulatory burdens. Margins are thin. Confidence is fragile. Even modest increases in fixed costs can tip viable businesses into closure.
This is why change must go further.
We urge government to:
- Ensure business rates change results in no net increase for hospitality and high-street businesses
- Strengthen transitional protections to avoid sharp bill rises following revaluation
- Address cliff edges that penalise businesses for growth or expansion
- Extend meaningful relief to mid-sized hospitality and leisure operators, not just the smallest premises
This is not a call to abandon change; it is a call to finish the job properly.
Why is this message coming from Liverpool? Because we know the risks of managed decline and the importance of working together to create a thriving destination, a vibrant city centre attracting investment, a cultural capital that is a mixed-use economy. We are a city doing well, but we risk undoing all the good of the past generation that has turned Liverpool around.
If the government wants thriving high streets, strong city centres and sustainable local economies, business rates must support occupation, investment and growth; not accelerate vacancy and decline.
We stand ready to work constructively with ministers to help shape a system that is fairer, modern and fit for today’s economy.
But the message from the frontline is clear:
Business rates change must genuinely reduce pressure on the high street; not simply rearrange it.
Signed,
Frank McKenna
Chief Executive & Group Chair
Downtown in Business
Bill Addy
Chief Executive
Liverpool Business Improvement District
