Without a solution from the government to avert business rates increases in April, 2,076 hospitality venues might be forced to close, including 963 restaurants and 540 pubs, as well as 574 hotels.
Currently, the average pub will see its rates increase by 15% next year - on average an extra £1,400 - and by 76% over the next three years – an average increase of £12,900.
The average hotel will also see its business rates increase by £28,900 next year and by £205,200 in total over the next three years – an increase of 115%.
UKHospitality is calling for the government to increase the business rates discount for hospitality properties from 5p to 20p, the maximum permitted in law. It says this is crucial to the government delivering its manifesto commitment to level the playing field between the high street and online giants.
“Staggering increases to business rates will affect the entire hospitality sector and without a hospitality-wide solution, we will see significant business closures,” says Kate Nicholls, chair of UKHospitality.
“Thousands of venues, particularly neighbourhood restaurants and local hotels, will be forced to close for good as a result of the significant rates rises they’re facing.
“This is yet another blow to a hospitality sector that bears the highest tax burden in the economy and has already been disproportionately burdened by increases to NICs, wages, energy and other inputs.
Nicholls adds: “Hospitality is one of the nation’s biggest employers and has an incredible potential to grow and create jobs, but the money coming in the front door is simply not enough to offset the rocketing costs of doing business.
“All of this undermines the government’s objectives to grow the economy and help more people back into work.
“We need a hospitality-wide solution that averts damaging business rates hikes in April.
“The Government needs to implement the maximum possible 20p discount to the multiplier for all hospitality properties.”
Last year already saw a decline in industry numbers, with 572 net closures of licensed premises over 12 months - marking a 0.6% fall - according to the Hospitality Market Monitor from CGA by NIQ.