Taxation: Small and Medium-sized Enterprises

Debate between Rachael Maskell and Dan Tomlinson

Tuesday 3rd February 2026 Westminster Hall

[Dan Tomlinson]

I am always happy to receive representations from Members on both sides of the House. I will look out for correspondence from the hon. Member in my very large weekend correspondence box, which I always enjoy on a Sunday evening.

[Rachael Maskell]

It might not have filtered through, but I have written to the Chancellor on behalf of many Labour MPs regarding concerns about small businesses and the fact that many of them will not receive the vital support that they need. They are very fearful of what is going to happen in just eight weeks’ time. Will the Minister look particularly at small businesses, which are not getting the relief and support that they need, and ensure that we are able to mitigate some of that? These businesses form a vital part of the whole economic ecosystem. If they are not growing and are instead shrinking then that will have an impact on our whole economy.

[Dan Tomlinson]

I thank my hon. Friend for her question and the representation that she provides in this place for the small businesses in her constituency—it is a wonderful part of the world. If my team have not been in touch already today, I am hoping that we can find time to meet next week for a conversation. I know that this issue is one that is really important to her. York is a fantastic, vibrant and growing part of our economy. I expect that some of what is happening here is that the businesses in her constituency have seen their values increase by more than others in parts of the country that have not been doing as well. That is why the Government have provided a range of support for businesses. I look forward to talking about that with her in the coming days.

We are fast running out of time, so let me turn to the topic of business rates, which Members have raised. It is worth noting that we are implementing significant reforms to the system. On the point around large online retailers, as far as I am aware, throughout the whole history of the business rates system—including the 14 years under the previous Government—the multiplier, otherwise known as the tax rate, for large online giants was exactly the same as that paid by a typical business on the high street. As part of fulfilling our manifesto commitment to reform the business rates system, we have introduced a really significant wedge into it: the multiplier for large online giants and their warehouses is now 33% higher than for a high street business.

I am aware, and we have had lots of discussions about it in this place, that that reform—the significant underlying reform to the business rates system—has happened at the same time as the revaluations since the pandemic have come into place, and at the same time as the Government have chosen to unwind, slowly and with significant transitional reliefs, the temporary pandemic support. That issue was raised by the hon. Member for Farnham and Bordon.

When the Conservatives stood for re-election, the OBR forecasts did not earmark any funding whatsoever for continued support within the business rates system for our high streets. The Conservatives say now that they would not have stuck with those plans, but had they done so—and they are the plans that they presented to the country before the election—the relief would have ended overnight in 2025.

Oral Answers to Questions

Debate between Rachael Maskell and Dan Tomlinson

Tuesday 27th January 2026 Commons Chamber

[Dan Tomlinson]

We have extended the temporary 5p fuel duty cut until the end of August 2026, and rates will then gradually return to early 2022 levels. The planned increase in line with inflation will also not take place. That will save the average driver £49 next year, compared with previous plans.

[Rachael Maskell (York Central) (Lab/Co-op)]

While pubs may have a large lobby, we know that independents power our local economy. I have looked through the spreadsheets showing the business rates for our independent businesses after the relief has been applied. Businesses in my city will see an increase of up to 93% in their business rates. What engagement has the Minister had with small independents to ensure that they are safeguarded through the relief that he is about to announce?

[Dan Tomlinson]

It is important to note that there is a 40% relief in the system for smaller and independent businesses. It will be phased out over the coming years; we have put in transitional relief protection. As the Chancellor said earlier, that is reasonable. Members from across the House will agree that it would not be right to have temporary pandemic support still in place at the end of the decade.

Business Rates

Debate between Rachael Maskell and Dan Tomlinson

Tuesday 27th January 2026 Commons Chamber

[Dan Tomlinson]

Over and over again, Conservative Members profess to be paragons of fiscal virtue, yet stand up in this place and say they want to cut taxation, which in effect means more and more borrowing. We have in the past seen the problems caused by Conservative Governments who let borrowing run out of control, cause interest rates to surge for families in our constituencies, send our economy to the dogs and harm living standards. We will not stand for that—we will not make the mistakes they made—and we will come forward with proportionate changes that support businesses, but that make sure we can continue to keep our public finances on a sustainable path.

[Rachael Maskell (York Central) (Lab/Co-op)]

York is a difficult place in which to trade, and with two thirds of businesses being independents, many will not get the relief the Minister has announced today. I sent through a paper with a spreadsheet of every business in the business improvement district showing that this just is not meeting their needs of those businesses, which will close. Will the Minister look at that detail, and ensure that resilience and support are built in, because York has a very strong retail reputation, but it is about to be challenged unless more help comes its way?

Business Rates: Retail, Hospitality and Leisure

Debate between Rachael Maskell and Dan Tomlinson

Monday 19th January 2026 Commons Chamber

[Dan Tomlinson]

As I have said, the Government were aware that a revaluation was taking place. That revaluation, which was initiated by the last Government, took account of property values in 2024, and will be in place from April this year. We were also aware—and Members in all parts of the House would probably agree on this—that by the end of the decade it would not be appropriate to retain the full pandemic relief almost 10 years after the height of the pandemic. In the round, as a result of those decisions, we came forward with a significant package of £4.3 billion of protection for businesses across the country—large and small, high street and non-high street—to help them adjust to the potential for higher bills that some are experiencing. Let me add that, as I said in my opening remarks, the business rates bills of about 50% of businesses are either flat or falling.

[Rachael Maskell (York Central) (Lab/Co-op)]

Pubs have a powerful lobby, unlike the independents on our high streets such as cafés and retail outlets. I have been poring over the spreadsheets showing the impacts that this will have on York. Some little retail outlets are seeing their business rates rise by 93%, and they simply do not have the resilience to deal with it. What will the Minister do for independents to ensure that they survive past March this year?

[Dan Tomlinson]

York high street, in my hon. Friend’s constituency, is a beautiful and wonderful place where there are many fantastic businesses. I worked there for a time. I know that Members in all parts of the House value the businesses that keep their high streets vibrant and thriving. We are taking steps, and we took steps in the Budget, to support high street businesses through our £4.3 billion of support, and we will continue to engage with Members and with businesses on the further steps that we can take to support them.

Oral Answers to Questions

Debate between Rachael Maskell and Dan Tomlinson

Tuesday 9th December 2025 Commons Chamber

[Dan Tomlinson]

Members on the Treasury Bench are fully aware of the fact that changes to inheritance tax have an effect on those who are older. In the changes to both agricultural and business property relief that we have put forward, we have ensured that there is a higher allowance, with an extra £1 million, and a tax rate that is half as low as everyone else pays. We think that these reforms, which raise money in a fair and sustainable way, will contribute to raising the revenue that we need, in a way that protects family farms. Of course, we understand that there will be impacts on people. That is why we have designed the policy in the way that we have, and why we came forward with the changes that we announced at the Budget just a few weeks ago.

[Rachael Maskell (York Central) (Lab/Co-op)]

Independent businesses in York are really struggling with the revaluation of business rates. In 2024 they were £6,200; in 2025 they are £15,000; and in 2026 they will be £19,100, after discounts. Will the Minister meet representatives from York High Street Forum to understand the challenge of those rates for my city?

[Dan Tomlinson]

I am happy to speak to my hon. Friend about the issues that she raises in her constituency.