Large restaurant groups overlooked in Budget 2020
The trade body welcomed measures to support smaller firms including a year-long scrapping of business rates for venues with a rateable value of less than £51,000 and a refund of 14 days statutory sick pay for companies with fewer than 250 employees.
But there was no comparable relief offered to larger businesses or those with higher rateable values to protect them from declining bookings and footfall amid the virus outbreak.
Some of the worst-affected restaurants are in London's Chinatown, which will have high rateable values due to their central location and therefore may not qualify for relief. A number of restaurants in the area have already temporarily closed to limit the impact of the virus on their bottom line.
“Many of the hardest hit businesses will not benefit, either because they have rateable values above £51k, or above £100k for pubs, or because state aid rules mean that venues in bigger chains - the larger employers - will be ineligible," says UKHospitality chief executive Kate Nicholls.
“The perverse nature of the current system is underlined by the ongoing Coronavirus situation, with punishing payments still expected of companies whose venues may not be able to open or operate.”
Boost for pubs
The Budget was broadly welcomed by the pub industry, with business rates relief increasing from £1,000 to £5,000 for pubs with a rateable value of up to £100,000.
All alcohol duties were frozen, following warnings from the trade that rising prices could stifle growth in the pub sector.
“Overall, this has been a great Budget for pubs, pub goers and Britain’s world-class brewing industry worth £270 million, we hope the Government continues to support our industry in the future,” says Emma McClarkin, chief executive of the British Beer and Pub Association.
Concerns for industry
But analysts warned the lack of support for large companies would be a “kick in the teeth” for the retail and hospitality sector.
“Whilst helping SME’s is to be applauded, there is nothing in the Budget that tackles the issues of the larger businesses – and these are the ones shedding the jobs, particularly in the retail and hospitality industry,” says John Webber, head of business rates at Colliers International.
“Without helping larger businesses on business rates, the silent majority is side-lined yet again.”
Chancellor Rishi Sunak promised a wider review of the overall business rates system would be completed by the Autumn Budget later this year.
