Scottish ministers are being called to extend business rates relief to struggling pubs, following a recent announcement by Andy Burnham for England's hospitality sector.
London, United Kingdom Jul 25, 2026 ALN: The ongoing debate regarding business rates relief for hospitality venues in Scotland has intensified following recent announcements from the UK government, particularly those made by Prime Minister Rishi Sunak and Labour Mayor of Greater Manchester, Andy Burnham. The situation has become a focal point for political discussions, with calls from various parties urging the Scottish Government to implement similar relief measures to support struggling pubs, social clubs, and live music venues across Scotland.
On Thursday, Prime Minister Sunak revealed that pubs, social clubs, and live music venues in England would receive a 20% reduction in business rates starting in April. This announcement follows a previous 15% cut that was introduced earlier in the year, aimed at alleviating financial pressures faced by the hospitality sector, which has been significantly impacted by the COVID-19 pandemic and subsequent economic challenges. The expected savings from these reductions are substantial; the average pub in England is projected to save over £1,000 annually due to these measures.
In Scotland, however, the situation is markedly different. Business rates, also known as non-domestic rates, are determined by the Scottish Government and are based on the rental value of non-domestic properties. This system has come under scrutiny, particularly after new rateable values were introduced in April, which led to significant increases in business rates for many establishments. While the Scottish Government announced cuts to the three bands of business rates—basic, intermediate, and higher—these adjustments have not alleviated the financial burden on larger hospitality venues.
Industry leaders have voiced their concerns, describing Scotland's business rates system as "broken." They argue that while smaller businesses benefit from rates relief, many larger establishments have not seen similar support since the pandemic. The Scottish Licensed Trade Association (SLTA) has been vocal in its demands for the Scottish Government to replicate the changes made in England. Colin Wilkinson, managing director of the SLTA, emphasized the need for the Scottish Government to recognize the challenges faced by larger businesses and to provide them with the necessary support to survive.
The issue has garnered attention from Labour politicians at both Westminster and Holyrood. A group of 26 Scottish Labour MPs recently wrote to Deputy First Minister Jenny Gilruth, highlighting the alarming trend of pub closures in Scotland. They noted that in 2025, one pub was closing every week, emphasizing that these establishments are vital to the communities they serve. The MPs urged the Scottish Government to commit to passing on the savings from business rates relief to Scottish hospitality venues, echoing the sentiment that immediate action is necessary to prevent further closures.
Moreover, evidence presented to Westminster’s All-Party Parliamentary Group (APPG) on the night-time economy indicated that hospitality sectors in Scotland are lagging significantly behind their counterparts in England, with an estimated £200 million deficit in state assistance. This disparity has raised concerns among industry groups, including the Scottish Beer and Pub Association and UKHospitality Scotland, who have warned that the unequal treatment of businesses based on their location is creating an unsustainable environment for many establishments.
Jo Fagan, the public finance spokesperson for Scottish Labour, articulated the importance of supporting hospitality businesses, which she described as the "lifeblood" of communities. She urged the Scottish Government to take cues from the measures introduced by the UK Government and to implement similar support for Scottish venues, emphasizing the need to keep costs manageable for patrons.
In response to these calls for action, First Minister John Swinney defended the Scottish Government's approach to business support, stating that it is providing over £900 million in transitional relief for businesses. During a recent meeting with the Prime Minister in Glasgow, Swinney was asked whether he would consider replicating the rates relief announced for England. He pointed out that Scotland has different business support structures in place, including the small business bonus scheme, which exempts many premises from business rates altogether. Swinney argued that the Scottish Government’s existing relief measures already address some of the needs of the hospitality sector.
Public Finance Minister Hannah-Mary Goodlad also highlighted that more than 100,000 businesses in Scotland are eligible for support through the Small Business Scheme. However, she acknowledged the need for clarity regarding how the UK Government's announcement would impact funding for Scotland’s block grant. The Scottish Government's decisions on rates and reliefs are typically outlined as part of the annual Scottish Budget, and it remains to be seen how this ongoing discussion will influence future fiscal policies.
The implications of these discussions are significant. The hospitality sector has been one of the hardest-hit industries during the pandemic, and the financial strain continues to affect businesses as they attempt to recover. As pubs and restaurants face rising costs and changing consumer habits, the need for a supportive economic environment has never been more critical. The disparity between the support available in England and Scotland raises questions about the fairness of the business rates system and the potential long-term impacts on the viability of hospitality venues in Scotland.
In conclusion, the debate surrounding business rates relief for hospitality venues in Scotland reflects broader issues of economic support and recovery in the wake of the pandemic. As calls for reform grow louder, the Scottish Government faces pressure to reassess its approach to business rates and consider measures that will ensure the sustainability of pubs, social clubs, and live music venues across the country. The outcome of these discussions could have lasting effects on the fabric of Scottish communities, where these establishments play a crucial role in social and economic life.
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