Review launched into how pub and hotel business rates calculated
The UK Treasury has launched a review into how business rates are calculated for pubs and hotels in England and Wales, led by rates expert Jerry Schurder, reporting in March 2027.
Intelligence analysis by Llama
Treasury review into business rate valuations for pubs and hotels in England and Wales will be led by Jerry Schurder, with findings due March 2027. The move comes amid pub closures and industry calls to reform the Fair Maintainable Trade method that ties pub rates to turnover.
Pubs in England pay their property tax in an unusual way: based on how much money they take in, not how big the building is. The government is reviewing this rule because so many pubs have been shutting down.
Analysis
Jerry Schurder
The Treasury has appointed Jerry Schurder, a former business rates policy lead at advisory firm Newmark UK, to lead the review into how rate valuations are produced for pubs and hotels in England and Wales. According to the Treasury, the review will consider a "rethink of valuations - so that we can build a fairer system for the future", in the words of financial secretary James Murray. Schurder's findings are expected by March 2027 and will feed directly into the next rates revaluation scheduled for 2029. The Federation of Small Businesses welcomed the appointment, with Craig Beaumont saying Schurder would bring "crucial heavyweight business rates expertise into the Treasury", though Beaumont added that ministers still needed to lift the small-business rates relief threshold to exempt more firms.
The scope of the review is narrow on its face: pubs and hotels. But the British Retail Consortium, through Tom Ironside, used the announcement to flag that retailers' needs should not be overlooked, hinting at industry fears that any redistribution of the rates burden could land on shops rather than address the system as a whole. Shadow Chancellor Sir Mel Stride went further, calling the review "far too late for a sector this Labour government has already done its best to kill off" and citing tax hikes on premises and the Employment Rights Act as pressures on hospitality. Liberal Democrat Treasury spokesperson Daisy Cooper also framed the announcement as overdue, while pushing for an emergency VAT cut and a reversal of jobs tax changes.
Fair Maintainable Trade
The core complaint from the pub sector is structural rather than cyclical. According to the British Beer and Pub Association (BBPA), pubs are valued for rates using a measure called Fair Maintainable Trade, which links a venue's rateable value to its turnover rather than simply to floor area as for most retail premises. The result, in the BBPA's telling, is that when a pub's sales rise, so does its rates bill, creating a feedback loop that disproportionately punishes higher-turning venues. BBPA chief executive Emma McClarkin said pubs have "paid a disproportionately higher business rates bill which has ground down their ability to keep the doors open".
Earlier interventions attempted to blunt this effect without changing the underlying valuation method. The government cut business rates for pubs and music venues by 15% earlier in 2026, and Greater Manchester mayor Andy Burnham announced an additional 20% cut for pubs, social clubs and live music venues in England to take effect in April. The July discount is intended to stack on top of existing support, though the government has excluded the "very largest" live music venues and acknowledged confusion among some operators about eligibility, with full details expected at Chancellor John Healey's first Budget in the autumn.
161 pubs closed
The pressure that prompted the review is visible in the closure data. The BBPA reports that 161 pubs closed in the first three months of this year across England, Scotland and Wales, equating to the loss of roughly 2,400 jobs. Rising business rates are cited as one driver, alongside increases to National Insurance and the minimum wage that have pushed up staffing costs. The trajectory matches earlier BBC reporting that British pubs were closing at a rate of almost two per day across 2026.
Context matters for sizing the policy response. Last year, under the previous chancellor Rachel Reeves, ministers had announced a full removal of pandemic-era business rate discounts from April, alongside substantial upward adjustments to pub rateable values, leaving many landlords facing much larger bills. Hospitality industry criticism then triggered the 15% cut earlier this year and now the 20% July relief, with the Schurder review sitting on top as the structural piece. Whether the March 2027 report leads to genuine reform of the Fair Maintainable Trade methodology, or settles for incremental revaluation changes, will determine whether the 161-pubs-a-quarter trend bends.
Key points
- Treasury appoints Jerry Schurder to lead a review of business rates valuations for pubs and hotels in England and Wales, reporting by March 2027.
- BBPA says pubs are valued using Fair Maintainable Trade, tying rateable value to turnover rather than floor area as for retail.
- 161 pubs closed in the first quarter of 2026 across England, Scotland and Wales, costing around 2,400 jobs according to the BBPA.
- Government has stacked a 15% rates cut for pubs earlier in 2026 with a further 20% cut announced in July, with eligibility details due at the autumn Budget.
- Industry groups including the FSB and BRC, plus the opposition, argue the review is too narrow and the wider rates system also needs reform.
If the review leads to a genuine rewrite of the Fair Maintainable Trade methodology, pubs could see structurally lower rates bills rather than one-off discounts, improving viability for higher-turning venues. Combined with the stacked 15% and 20% reliefs already in train, the sector would have both short-term cash relief and a longer-term fairer valuation framework heading into the 2029 revaluation.
Findings are not due until March 2027 and will only feed into the 2029 revaluation, meaning pubs face several more years of higher bills even after the discount package. Critics including the FSB and BRC warn the review is narrowly scoped and may simply redistribute the burden onto retailers or smaller firms without addressing the wider system.
