New analysis has uncovered a stark disparity in business rates outcomes, with Treasury offices set to benefit from significant reductions while pubs across the UK face soaring bills that threaten closures and job losses.
Government Department Sees Tax Bill Decrease
Tax firm Ryan's examination of official Government figures indicates that HM Treasury's offices at 1 Horse Guards Road will see their annual business rates bill decrease by £288,180 during the 2026-27 financial year.
Despite the property's value increasing by 4%, the Treasury's bill will drop to £9.62 million next year. This reduction comes from changes to both the multiplier used to calculate rates and adjustments to the tax base of rateable properties.
Pubs Face Dramatic Increases
Meanwhile, British pubs are confronting a very different reality. According to Valuation Office Agency data, pubs will see their rates bills rise substantially from next year after their rateable values increased by an average of 32%.
The hospitality sector faces this increase despite the Government ending a 40% discount for retail, hospitality and leisure firms from April. While transition relief measures will temporarily cushion the blow, these will be completely phased out by April 2029.
Industry Warnings and Government Response
The Government has faced significant criticism from industry leaders and trade groups who warn that these tax changes could lead to widespread closures and job losses across the UK's hospitality sector.
In response to mounting concerns, the Government has indicated plans to provide further financial support for pubs in the coming weeks. However, other sectors including hotels have expressed fresh concerns about potentially missing out on any relief measures.
Central London Office Landscape
The analysis reveals a complex picture for office properties across Central London. While the Treasury's offices benefit from reductions, most large offices across the capital will face increased tax liabilities from April.
Alex Probyn, practice leader for Europe and Asia-Pacific property tax at Ryan, explained: "Across the seven principal Central London office districts, an 11.9% rise in rateable values generates £607.9 million of additional rateable value."
He added: "Even after lower multipliers and transitional relief, that still results in a £78.7 million increase in business rates liabilities in 2026-27 once supplements are taken into account."
Policy Context and Treasury Statement
The business rates changes stem from November's budget, where the Chancellor announced that rates would be "permanently lower" for small retail, hospitality and leisure businesses. However, sector leaders have challenged this claim over the past two months.
A Treasury spokesman stated: "Property valuations for business rates are calculated independently by the Valuation Office Agency. HM Treasury will be paying a higher multiplier next year to help fund a lower rate for the high street, as part of the Government's commitment to rebalance the business rates system."
The overhaul also included new property valuations for 2026, which resulted in significant jumps in the average value of hospitality businesses including hotels and pubs, creating the current disparity between government offices and commercial hospitality properties.
