News Beat
Hilton, Butlin’s and Travelodge warn prices may rise for customers
BOSSES of leading hotels and holiday parks are calling for a financial lifeline amid a rise in business rates.
More than 130 top accommodation firms have written to Rachel Reeves saying increases will not be easily absorbed and could push up prices for holidaymakers.
Firms such as Butlin’s, Hilton and Travelodge have joined forces to warn ministers that passing on costs will add more strain on hard-up Brits.
Figures from the sector reveal the average hotel business rates bills will go up by 115% over the next three years costing £205,000.
The Treasury will bring forward a support package on pubs but pressure is mounting for an enhanced measures on accommodation and restaurants.
The letter states: “While additional support for the hospitality sector is welcome, it’s critical that it should not only extend to pubs, but should be a whole-sector solution.
“These changes to business rates present the most significant challenge to accommodation providers in terms of their ongoing viability, and many will face tough decisions in terms of employment and their ability to invest.
“As you know, there is already immense pressure on the investment case for hotel development in the UK, given heightened build costs and concerns about new tourism taxes.
“We therefore urge you to consider the accommodation sector when considering any support measures to address these crippling changes.”
Kate Nicholls, chair of UKHospitality, said: “Hotels and holiday parks are the hardest hit by business rates hikes, facing 115% increases.
“As this coalition so clearly sets out – this will only have adverse impacts on employment, investment and, in some cases, business viability.
“Accommodation businesses will unfortunately have no choice but to pass these additional costs onto the consumer – which will only worsen the cost-of-living crisis and drive inflation.
“The Chancellor has recognised that hospitality needs further business rates support – it’s crucial the entire sector receives that much-needed support.”
In November’s autumn budget, the Chancellor launched significant changes to business rates, the commercial property tax impacting hospitality and high street firms.
The Treasury announced a reduced multiplier for calculating rates but also revealed that a current 40% discount for retail, hospitality and leisure firms will end in April.
It will be replaced by a transition relief, but this will phase out after three years.
The budget also confirmed that new property valuations will be used for 2026, which have contributed to significant long-term rate increases for hotels, as well as other hospitality businesses.
