Tom Kerridge welcomes reports of expected business rates increase u-turn but calls for VAT reduction

Celebrity chef Tom Kerridge has welcomed reports of an expected Government u-turn on business rate increases for pubs – but has called for VAT to be reduced.

Kerridge, whose business portfolio includes acclaimed Marlow restaurants The Hand and Flowers and The Coach, previously spoke out over the impact higher business rates for pubs would have on his hospitality businesses.

Hospitality firms have faced a rise in their business rates after chancellor Rachel Reeves announced that the business rate relief which had been in place since the COVID-19 pandemic would be reduced from 75 per cent to 40 per cent for 2025/26.

She also said this relief would be scrapped altogether from April this year.

Businesses have also been hit by a reevaulation of the rateable value of properties, leading to increased bills for some.

The Government had announced a £4.3billion support package to provide relief to those seeing increases in business rates due to the changes.

Since the announcement, there has been mounting pressure from the industry, which has been concerned about the impact of the rises on their businesses and have campaigned for a u-turn.

Some pubs have ever banned Labour MPs over the issue.

But this month, it has been widely reported that the Government is expected to change its business rate plans for pubs.

Chancellor Rachel Reeves told the BBC last week ‘there is additional support coming’ but an announcement is yet to be made.

The Chancellor has also hinted an additional support package may only be focused on pubs, rather than the wider hospitality sector.

Prior to this, Tom Kerridge had spoken out against the plans and called for the Government to ‘rethink the rates increase’.

Following reports of a u-turn, Kerridge said: “Obviously, the government’s u-turn is hugely appreciated by the industry.

“It means that they are perhaps listening.”

But Kerridge has called for the Government to go further and reduce VAT rates to bring them in line with ‘the rest of Europe’s hospitality rates of between 8 and 12 per cent.

He added: “Moving forward, it is very important that a reduction in VAT in line with the rest of Europe is considered as the main way of helping the whole of hospitality, not just pubs.”

A HM Treasury spokesperson said: “We recognise the significant value pubs bring to communities and the Chancellor and Prime Minister have been clear that we are determined to support them.

“The £4.3bn support package announced at the Budget was the right thing to do to protect the majority of ratepayers from increases to their business rates bills.”

Speaking on business rates support on January 7, Prime Minister Keir Starmer, said: “During Covid the rates went down and that was coming to an end, and that is why we put in place interim relief as we move to the new rates.

“We are continuing to work with and talk to the sector on that support and what further support and action we can take.”