The ‘Halloween’ budget has left Bristol hoteliers fearing for their future in the wake of rising taxes and increasing costs.
The new Government’s first budget has been a case of the “same old story” according to the
Bristol Hoteliers Association (BHA), with businesses facing multiple rising costs in April.
Prime Minister Sir Keir Starmer had warned that Labour’s first budget since being elected into Government during the summer would be painful because of the economic situation the party had inherited from the Conservatives.
While Chancellor Rachel Reeves did extend business rates relief for the hospitality and retail sectors, this was at a reduced level of 40% compared to the current rate of 75%.
BHA Chair Raphael Herzog said: “Our initial reaction to the budget is that it has not been a particularly good one for our sector and has fallen some way short of what we have hoped for.
“For years, we have supported trade body UKHospitality’s call for a return to a reduced rate of VAT for our sector but that plea has once again fallen on deaf ears, as it did with the previous Government.
“The reduced level of business rates relief means there will be increased costs for businesses to meet from April, and when you add to that the impact of the Chancellor increasing the minimum wage and National Insurance contributions for employers, then this Halloween budget leaves many businesses fearing for their future.
“The only crumb of comfort came from the Chancellor’s announcement that Labour intends to introduce two permanently lower tax rates for retail, hospitality and leisure properties from 2026/27.
“But the ‘devil is in the detail’ as they say and we have no idea what this proposal looks like and how much of a difference it will make.
“And for some businesses, particularly the smaller and medium-sized ones, they’ve got to be able to get to 2026/27 first, overcoming the challenge of the increased costs coming their way in April.
“While the promise of permanently lower tax rates provides us with a glimmer of longer-term light at the end of the tunnel, there is going to be some additional short-term pain to come first and it seems as if 2025 is going to be yet another very challenging year for hospitality sector.”
