Business rates cut for hospitality and leisure businesses across Wales

Pubs, restaurants, cafés, hotels, gyms and other hospitality and leisure businesses across Wales are to see their business rates bills cut by 30% under new Welsh Government plans.

The move forms part of the Welsh Government’s manifesto commitment to rebalance business rates and provide greater support to businesses in town centres.

This permanent support will exceed the 15% temporary relief for food and drink hospitality currently in place, which it is hoped will provide businesses the certainty needed to plan and invest for the future.

Businesses set to benefit include:

• Food and drink hospitality venues: pubs, restaurants, cafés, bars, food courts, licensed clubs and live music venues
• Visitor accommodation: hotels, guest houses and hostels
• Leisure venues: cinemas, theatres, libraries, museums and gyms

Eligible small to medium-sized properties with a rateable value below £51,000 will receive the permanent support, with retail shops also continuing to benefit under the scheme, building on the lower multiplier in place this year.

A small increase to the higher multiplier, which applies to the highest-value properties in Wales, will fund the support, without reducing the overall contribution business rates make to funding public services in Wales.

First Minister Rhun ap Iorwerth said: “Our high streets are the heartbeat of communities right across Wales, and the businesses that fill them deserve our backing.

“This 30% cut to rates for pubs, cafés, gyms, hotels and so many other local favourites is about giving those businesses the confidence to invest, grow and keep serving the communities that rely on them.

“We’re making the system work better for the sectors that bring our town centres to life.”

The change sits alongside the work of the Town Centres Taskforce, which will consider what more tailored support individual town centres need, recognising that different parts of Wales face different challenges.

Cabinet Minister for Finance Elin Jones added: “This significant and permanent change will make a real difference to eligible hospitality and leisure businesses right across Wales.

“We’ve taken a balanced approach, ensuring this support is affordable while protecting the vital contribution business rates make to our public services – targeting help where it will have the greatest impact on our high streets.”

Regulations will be brought forward in the autumn and, subject to Senedd approval, will take effect from 1 April 2027.

The precise values of all multipliers for 2027-28 will be confirmed as part of budget preparations, following the UK Government’s Autumn Budget

Carolyn Brownell, Executive Director of FOR Cardiff, said: “This is meaningful and welcome support for the hospitality and leisure and visitor businesses that play such an important role in Cardiff city centre. The permanence of the reduction is particularly significant. Businesses cannot plan, recruit or invest confidently when vital support changes from one year to the next, so providing greater certainty from April 2027 is a positive step.”

“We must also keep the scale of the announcement in perspective. The additional saving for businesses currently receiving 15% hospitality relief will be valuable, but it will not remove the considerable pressures created by wages, energy, supplies and other operating costs.

“The £51,000 threshold also means that some of Cardiff’s larger hospitality, leisure and cultural venues will remain outside the expanded support altogether. We therefore welcome this announcement while continuing to call for a business-rates system that supports businesses of every size and reflects the cost and reality of trading in a major city centre.”

Becca Thomas owns Bacareto, a wine bar on Church Street in Cardiff city centre. She said “The news of this new, additional, and especially permanent support is heartening. Independent hospitality brings so much value and character to Cardiff City Centre, but over the past few years the increasing costs of operating have made it a case of survive, rather than thrive. We’re really pleased that this feels like a meaningful step in the right direction, which we estimate will save our business around £3k a year. However, we do need to acknowledge that the whole sector is under enormous pressure – and needs further support to ensure businesses can continue to operate, build and make Cardiff the unique Capital City that it is.”

Natalie Isaac, is co-owner at Forty Four Group who manage two restaurants and a boutique hotel in the city centre. She said, “The Welsh Government’s business rates reduction is genuinely welcome news and will provide much-needed breathing space for many Welsh businesses. But the £51k threshold creates a real cliff edge that risks leaving too many businesses on the wrong side of the line.

A rateable value of over £51k doesn’t suddenly make you a big business – yet under this approach it can mean the difference between receiving valuable support and receiving nothing at all. We operate two restaurants and nine bedrooms in the city centre, and one of the sites falls just above the threshold and will receive nothing.

We absolutely welcome the help being offered, but a hard cut-off is a blunt instrument. A tapered system would be much fairer and would avoid successful Welsh SMEs being penalised simply because their premises fall just above an arbitrary threshold.”

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