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September’s CPI inflation data will cause an additional £48m increase to business rates meaning the overall bill, set for April, will likely hit £914m, according to UKHospitality.
As a result of this the trade body is calling on the chancellor to introduce a lower, permanent and universal multiplier for hospitality.
It stated that business rates already make up around 5% of business turnover in the sector and, without action, a large pub or restaurant could face a £33,500 increase in its rates.
Kate Nicholls, chief executive of UKHospitality, said: “These inflation figures confirm that hospitality is set for an eye-watering £914m tax bill in April, if the chancellor doesn’t act at the Budget.
“Business rates must be addressed, or venues at the heart of communities will see their rates bills quadruple and find themselves making awful decisions about whether to shorten hours, close more days, lay off staff, or even close their doors for good.
She added: “A lower rate of business rates for hospitality would avoid this dreadful prospect and keep hospitality at the centre of our high streets. Measures in the Budget could be an investment in our high streets, creating new jobs driving local economic growth and securing the future of the venues that people love.”
The latest CPI figures saw inflation drop to 1.7% in September, a surprising drop.
