English pubs will receive a 15% discount on their business rates from April this year. The government deal, which also applies to music venues, follows a backlash from landlords who were facing a steep increase in their tax bills.
Some industry campaigners have said the support package – worth around £1,600 per pub – will allow landlords to breathe a sigh of relief. Some opposition politicians think it doesn’t go far enough.
Either way, it’s been a tough few years. High energy costs, inflation and wage increases have contributed to the serious financial difficulties facing many pubs.
The sector was also among the worst affected (alongside retail and leisure) by the social distancing and lockdowns of COVID. The government responded at the time by giving pubs significant business rate discounts in a show of support.
Then, in November 2025, it was announced that those discounts would be reduced and then phased out completely. This move, combined with big increases in the rateable values of pub premises, left landlords with the prospect of much higher bills.
But pubs are far more than cash machines for the Treasury. To many, they represent a vital part of British traditions and heritage. They also play a pivotal role in building and maintaining social relationships among the people who live near them.
Whether that’s a family meeting up for Sunday lunch, university students at their society gathering, or some elderly fans of real ale, pubs have a clear and long-standing role in creating community cohesion.
Several scientific studies have measured their positive effects on people, economies and societies.
One, for example, confirms the strong link between pubs and local community events. It has also been shown that pubs are often more effective than other organisations at stimulating a wide range of social activities. This could include everything from sports teams and quiz nights to hosting book groups, as well as charitable and volunteering initiatives.
Pubs also frequently promote community events – such as charity events and social clubs – more effectively than other places such as sport or village halls. Research has shown that in rural areas especially, pubs are very effective – more so than village shops for example – at building community cohesion and local social networks.
Overall, opportunities for communal initiatives in some areas would be extremely reduced, if not nonexistent, without pubs. This is why the loss of a pub has a much broader impact than a mere business closure.
Yet despite all of this proven positive impact, the number of UK pubs has been constantly declining since the start of the century. According to the British Beer and Pub Association, there were 60,800 in 2000, compared to about 45,000 in 2024, meaning one in four closing its doors in the past 25 years.
Last year, one pub a day in England and Wales closed down for good.
Life for publicans has been extremely hard for a long time. This is why the changes proposed in the last budget prompted a significant pushback from the industry.
Last orders
But other businesses probably deserve a tax break too. High street shops can also help maintain higher levels of socialisation and community cohesion.
Particularly in remote and rural areas, which suffer from a general lack of local services and public transport options compared to urban areas, these businesses are important in terms of economic development and social activity.
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They are also a vital part of their local economic structure, providing employment opportunities and training for local residents. This is why the Treasury should consider a rethink about business rates across the board.
Like pubs, local businesses have value beyond the revenue they generate. A tax system which recognises their positive social impact would be a better and fairer fiscal tool all round.
