Yesterday afternoon, Rachel Reeves delivered the 2025 UK Budget. Although very little detail was included in the public address, we’ve broken down our view on the full announcement which included:
- An extension of established rates retention schemes in several locations until 2029.
- A 10-year extension of the relief afforded to electric vehicle charging points to encompass EV-only forecourts.
Shortly afterwards, the full detail was provided and the Valuation Office published both the Draft 2026 List: Find a property - Valuation Office Agency - GOV.UK with the Statistical data (Changes between the 2023 and 2026 List): Non-domestic rating: change in rateable value of rating lists, England and Wales, 2026 Revaluation (draft list) - GOV.UK
The Budget included measures, which will impact what businesses will be paying come April next year, and we have outlined the multipliers below.
The Multipliers
We have confirmation of the two lower small business multipliers, medium multipliers - £51,000 RV up to £499,000 – and the highest multiplier – All Properties above £500,000 Rateable (RV).
| The Multiplier Description | 2025-26 | 2026-27 | Multiplier Levels |
| Small business RHL | | 38.2p | RHL hereditaments with RVs under £51000 |
| Standard RHL | | 43p | RHL hereditaments with RVs between £51000 and £499,999 |
| National small business multiplier | 49.9p | 43.2p | Non - RHL hereditaments with RVs under £51000 |
| National standard multiplier | 55.5p | 48p | Non - RHL hereditaments with RVs between £51000 and £499,999 |
| High-value multiplier | | 50.8p | All hereditaments with RVs above £500,000 |
| **Crossrail supplement for Greater London, and City of London Supplement – to be confirmed |
Effects of the business rates retail, hospitality and leisure multipliers and high-value multiplier - GOV.UK
These significant changes are intended to ease the burden of the tax on approximately 750,000 Retail, Leisure and Hospitality (RHL) occupiers in England. (The Multipliers in Wales will follow).
The confirmation of the higher multiplier, above £500,000 is not good news for larger businesses and key employers, seeking to invest. ‘Large businesses’ are being asked to absorb the greatest increases in future liability, which will impact investment.
Transitional Relief
Transition will be more complicated as a full analysis needs to be undertaken to calculate true liability and will be updated in due course. The key levels are as follows:
- Up to £20,000 (£28,000 in London): in 2026-27 – 5%, in 2027-28 – 10% (plus inflation), in 2028-29 – 25% (plus inflation).
- £20,001 (£28,001 in London) to £100,000: in 2026-27 – 15%, in 2027-28 – 25% (plus inflation), in 2028-29 – 40% (plus inflation).
- Over £100,000: in 2026-27 – 30%, in 2027-28 – 25% (plus inflation), in 2028-29 – 25% (plus inflation).
| Transitional Cap | 2026/27 | 2027/28 | 2028/29 |
| Small (RV £20,000, £28000 LDN) | 5% | 10% | 25% |
| Medium ((RV £20,000, £28000 LDN to £100,000) | 15% | 25% | 40% |
| Large (RVs above £100,000 | 30% | 25% | 25% |
There is also a Business Rates Transitional Relief Supplement being introduced - a 1p surcharge, which will be charged to those who fall outside the transition or small business relief scheme.
The liability caps for larger properties (above RV £100k) are slightly more generous in years 2 and 3 than under the current Rating List. Those with the greatest increase in Rateable Value (above £500k) will see relief and gradual phasing of the uplift. Uncertainty remains for large business in Greater London, with local supplements (Crossrail and City of London) not being confirmed and most likely will continue to be outside the scope of transitional relief.
Draft 2026 Rating List Sector Impact
Another core announcement is that the new Rateable Values (RVs) should reflect the change of rents between April 2021 and April 2024.
The Draft 2026 list, for the new revaluation from next April has resulted in significant increases across the main sectors – in England and Wales:
| Type | Description | Total 2023 RV | Total Draft 2026 RV | % Change |
| All | All Properties | £70,783,105.00 | £84,397,355.00 | 19.23% |
| Sector | Other Sector | £20,991,839.00 | £26,918,163.00 | 28.23% |
| Sector | Industry Sector | £19,121,597.00 | £23,155,393.00 | 21.10% |
| Sector | Offices Sector | £15,972,996.00 | £18,262,138.00 | 14.33% |
| Sector | Retail Sector | £14,696,673.00 | £16,061,660.00 | 9.29% |
Following the Revaluation, there are now an additional 4100 (out of 2,132,310) properties with a Rateable Value above £500,000.
The circa £14billion increase in global rateable value has allowed the Government to reduce the standard multiplier (as applied to RVs to calculate a ratepayer’s liability) from 55.5p (25/26) to 48p (26/27).
Occupiers of warehouses used by online retailers were cited as one of the targets, the higher rate (£500,000) will, of course have wider implications for large shops, arenas and hospitals, for example.
Property Sectors Impacted the Most
In terms of properties, that have seen the largest increase (by description):
| Description | Total 2023 RV | Total Draft 2026 RV | % Change |
| Civil Airports | £402,548.00 | £1,588,821.00 | 294.69% |
| Transport Sub-sector | £620,773.00 | £1,928,040.00 | 210.59% |
| Royal Palaces | £8,218.00 | £24,696.00 | 200.51% |
| Arenas | £26,978.00 | £64,075.00 | 137.51% |
| Game Farms | £1,106.00 | £2,556.00 | 131.10% |
| Car Parking Within/Part Of Specialist Property | £676.00 | £1,511.00 | 123.52% |
| Lodges | £102.00 | £225.00 | 120.59% |
| Railways & Tramways (Non Leisure) | £85,985.00 | £182,341.00 | 112.06% |
| Hotels (4 Star And Above) & Chain Operated 3 Star | £1,152,193.00 | £2,265,133.00 | 96.59% |
| Public Houses/Pub Restaurants (Including Lodge) | £56,676.00 | £96,047.00 | 69.47% |
| Public Houses/Pub Restaurants | £1,213,652.00 | £1,578,399.00 | 30.05% |
The initial data shows that Airports, Royal Palaces, Arenas, Leisure and hospitality properties (Pubs and Hotels) have experienced some of the greatest increases in Rateable Value as a result of the 2026 revaluation.
The Decreases Sectors
In terms of the few that have seen a decrease (by description and percentage):
| Description | % Change |
| Film Studios | -26.76% |
| Pumping Mines | -26.56% |
| Museums And Art Galleries (Non-Contractors) | -11.33% |
Regional Changes: England and Wales
| Region | All Property % | Retail % Change | Industrial % Change | Office % Change | Other Class % Change |
| England and Wales | 19.2 | 9.3 | 21.1 | 14.3 | 28.2 |
| England | 19.4 | 9.5 | 21.1 | 14.4 | 28.6 |
| North East | 17.6 | 2.5 | 25.1 | 17.3 | 22 |
| North West | 19.3 | 6.2 | 24.8 | 14.7 | 25.3 |
| Yorkshire and The Humber | 17.8 | 7.6 | 22.7 | 15.4 | 20.1 |
| East Midlands | 16 | 9.2 | 18.2 | 5.8 | 20.2 |
| West Midlands | 17.1 | 8.8 | 20.4 | 12.4 | 20.3 |
| East of England | 17.9 | 9.4 | 19.8 | 11.7 | 23.2 |
| London | 22.3 | 13.2 | 23.8 | 14.2 | 44.8 |
| South East | 19.6 | 9.7 | 19.7 | 16.9 | 27.2 |
| South West | 17.6 | 6.8 | 18.5 | 19 | 23.5 |
| Wales | 15.2 | 5.1 | 20.2 | 10.7 | 19.6 |
Key Takeaways
The Multiplier Framework has been confirmed – a range of multipliers between 38.2p and 50.8p – good news for Smaller Business and the Retail and Hospitality Industry – but not good news for those with Rateable Values above £500,000.
The total rateable value of these properties was £84.4 billion compared with £70.8 billion on the 2023 rating list. All Property has increased by 19.2% (England and Wales) – London up by 22.3%.
The changes have resulted in winners and losers, as we might expect - the hardest hit will be the biggest employers and on properties which include NHS Hospitals, Offices (London and nationwide), Industrial/Logistics, Airports, destination Retail, Supermarkets, Cinemas and Hotels.
All businesses need certainty, and the system has just become even more complicated.
For tailored advice on how these changes will affect you, contact our Business Rates team.
