By Frank McKenna and Bill Addy
It is right to acknowledge that the government has begun to recognise the strain facing Britain’s high streets and hospitality sector.
The continuation of retail, hospitality and leisure relief, alongside plans for lower business rates multipliers from 2026, shows that ministers understand the system is broken.
But recognition alone won’t save high streets.
The real test of reform is simple: will hospitality and high-street businesses be better off in practice?
Right now, that outcome is far from guaranteed.
Many operators face higher bills despite headline reforms, driven by revaluations, cliff edges and the gradual withdrawal of relief. For businesses already operating on wafer-thin margins, that is not a technical detail — it is an existential threat.
Hospitality is already one of the most heavily taxed and cost-burdened sectors in the economy. VAT remains at 20%. Wage costs are rising. Recruitment is difficult. Regulatory demands are growing.
In Liverpool, it will be an average of a 30% increase. What business, faced with the challenges hospitality has faced in the past five years, can survive a 30% tax increase without having to severely cut its cloth?
Add higher fixed property costs into that mix and the outcome is predictable: closures, job losses, empty units and declining footfall.
Once a high street tips into decline, recovery is slow and expensive — and often borne by the taxpayer.
There is a contradiction at the heart of current policy. Government talks about growth, regeneration and vibrant city and town centres, while risking reforms that may still penalise the very businesses that deliver those outcomes.
Business rates change must do more than look good on paper.
It must:
- Deliver no net increase for hospitality and high-street operators
- Protect businesses from sudden post-revaluation shocks
- Remove cliff edges that punish ambition and growth
- Support occupation, not vacancy
This is not special pleading. It is economic realism.
If reform leaves restaurants, pubs, shops and venues worse off, then it will not revitalise high streets — it will quietly finish them off.
Government has started down the right path.
Now it must make sure the destination is the one it actually intends.
Bill Addy is the Chief Executive of the Liverpool Business Improvement District Company which represents over 850 businesses in the hospitality, leisure and visitor economy.
Frank McKenna is the chief executive and group chair of Downtown in Business, a private sector lobby group that represents over 150 hospitality businesses across the country.
The Liverpool BID Company and Downtown in Business recently launched a national campaign: ‘Unlocking Britain’s Visitor Economy’ see details here.
