Welsh hospitality is set to be hit with a “mammoth” £122 million hike to its business rates bills over three years, UKHospitality Cymru is warning.
The trade body said the continued exclusion of hospitality from business rates reform in Wales will accelerate high street decline, job cuts and business closures, and called the Welsh Government's Final Budget 2026/27 “disastrous” for the sector.
It said its analysis suggests that, when compared to the current financial year, the sector’s business rates bill will increase by £29.4 million next year, £40.1 million in 2027/28 and £52.6 million in 2028/29. In total, business rates will increase by 63% over the next three years, it says.
The increases are driven by the removal of current business rates relief, hospitality being excluded from business rates reform and an inadequate package of transitional relief, UKHospitality Cymru says. This is compounded by rateable values increasing by 23% on average for the sector, it added.
David Chapman, Executive Director of UKHospitality Cymru, said:
“This Budget is disastrous for Welsh hospitality. The scale of these shattering increases will be unsustainable for many businesses and the decision to exclude hospitality from any support will only drive further job losses and businesses closures.
“Communities and their local hospitality venues will be the ones bearing the brunt of an unjust system that has long been broken, despite promises to reform it for the better.
“The system is in dire need of reform and the Welsh Government’s efforts barely touch the side of what is required.
“It is now vital that the Welsh Government commits to using, in full, any additional funds flowing from additional support in England to support hospitality businesses.
“All political parties seem to agree that hospitality is unfairly treated by the business rates system, yet still nothing happens. That must change.”
