Andy Burnham’s new government has announced a 20% business-rates reduction for pubs, clubs and live music venues, costing £100m, as part of efforts to support high streets and slow pub closures. Publicans welcomed the signal of support but said the relief would make only a limited difference because VAT, wages, employer taxes, energy and other operating costs remain far larger pressures on profitability.

At the Red Lion in Derbyshire, owner Dan Smith estimates rates add about 16p to a £20.50 pie-and-pint order, compared with £3.42 in VAT; he pays roughly £680 a year after previously receiving rural-business relief. A typical hospitality business with £1m turnover may pay about £5,000 in rates and save around £1,000 under the policy, yet retain only about £13,500 profit after tax. Industry figures argue that reducing VAT for hospitality from 20% to 10% would have a much greater effect, although it could cost the Treasury an estimated £10bn.