Business Rates

Steve Darling Excerpts

Tuesday 27th January 2026 Commons Chamber

[Mr Speaker]

I call Jennie’s dad, Steve Darling.

[Steve Darling (Torbay) (LD)]

This is a baby step in the right direction, but the hospitality, tourism and retail industry in Torbay continues to trade in a hostile environment. One leisure provider in Paignton shared with me that they have a £44,000 gas bill. Will the Minister share what the Government are doing to tackle these high energy prices that many suffer from?

Finance (No. 2) Bill

Steve Darling Excerpts

Committee of the whole House
Tuesday 13th January 2026 Commons Chamber

[Mr Kohler]

Indeed I do. It is death by a thousand cuts. Those who run hospitality businesses have been hit by cost after cost after cost. The Government must listen.

Alcohol duty brought in about £12.5 billion in 2024-25. Hospitality, by contrast, contributed over £60 billion to the economy in 2023 and supported over 2.5 million jobs—over 7% of the workforce. Yet UKHospitality estimates that 89,000 jobs—nearly 100,000—were lost in the nine months after the October 2024 Budget. Official figures show that 366 pubs closed in the year to December 2025. That is one pub every single day. The roots of this crisis lie in years of Conservative mismanagement, Brexit labour shortages, a broken business rates system, energy price shocks, commodity price increases and a cost of living crisis. Many in the sector hoped that the change of Government would bring a change of direction, yet things have only got worse with the rise in employer national insurance contributions.

The cumulative effect is undeniable: rising costs for shorter opening hours and fewer staff. Offering us easier or longer opening hours does not help if we do not have customers coming through the door. Investment is deferred, and too often doors close for good. When that happens, high streets lose more than businesses; they lose employment, footfall and the social infrastructure on which communities depend. That is why the Lib Dems are calling for an emergency cut in VAT for hospitality to 15% until April 2027, real reform of business rates and a proper review of the unworkable wine duty system. Such measures would protect jobs, support high streets and, in time, strengthen the public finances rather than weaken them.

The hon. Member for Edinburgh South West (Dr Arthur), who is no longer in the Chamber, asked where the money will come from. We keep telling Labour: get rid of the red lines and negotiate a customs union with the EU, which would raise £25 billion a year for the Exchequer. Businesses in Wimbledon and across the country are not asking for our pity; they are asking for a tax system that reflects the pressures they actually face. If Ministers are serious about protecting jobs, strengthening high streets and growing the economy, they should reverse this tax increase and introduce an emergency VAT reduction for hospitality.

[Steve Darling (Torbay) (LD)]

I will focus on Liberal Democrat new clause 9, which would require an assessment of the cumulative impact of the proposals on the hospitality industry.

One must bear in mind that, after a medley of challenges, our hospitality industry fears the future—it is in crisis mode—so it is not prepared to invest or take a chance by improving its offer, and it is hunkering down and hoping for the best. I reflect on the international pandemic, which had a massive impact; Torbay’s tourism and hospitality industry has still not recovered to pre-pandemic levels. The outrageous second invasion of Ukraine almost four years ago caused a shock in our energy costs. I am afraid that there have also been self-inflicted wounds, such as the national insurance hike and the ensuing employment challenges.

David from Rock Garden in Torquay told me that his utility bill has risen to £3,000 a month, which dwarfs his rental costs. Ofgem is asleep at the wheel; it must back local businesses and drive the changes that we need. Our hospitality industry is horrified by the proposals for business rates. The Government must apply the full 20% rate of relief to ensure that there are protections. I am afraid to say that many people in the hospitality industry scoff at proposals that simply deregulate around the edges, because if they do not have paying customers in their premises, they are set up to fail.

[Caroline Voaden (South Devon) (LD)]

Will my hon. Friend give way?

[Steve Darling]

I will happily give way to my Devon colleague.

[Caroline Voaden]

As his constituency neighbours mine, my hon. Friend may be aware that three much-loved venues—Wild Artichokes, the Old Warehouse and the Old Bakery—closed in the town of Kingsbridge last week. The owner of one of those venues told us that part of the problem was the cumulation of challenges faced by the hospitality industry—not just the lack of people coming through the door and spending money because of the cost of living crisis, as my hon. Friend just said, but the rises in business rates and employer national insurance contributions, which have made it impossible for businesses to continue. Does he agree that it is a tragedy that such venues are closing every day, and that something must change before the hospitality industry is devastated?

[Steve Darling]

My hon. Friend is spot on. We need the Government to wake up, smell the coffee and recognise the challenges that our hospitality industry faces.

Some national chains, such as Wetherspoons, use their buying power to drive down the cost of a pint—many customers reflect on prices when they cross the threshold of a venue. The reality for lots of independents—because it is independents that are really important—is that £6 a pint is the minimum they can achieve with all the costs that are involved. When we compare that with the cost in a supermarket, it is really scary. The Minister rightly highlighted the difference we see today, with more than 70% of the alcohol consumed having been purchased at a supermarket. I feel we need to have a national debate about whether we have got the balance right and how we can ensure that we are driving greater footfall towards our hospitality industry.

[Victoria Collins (Harpenden and Berkhamsted) (LD)]

I want to reiterate how important that is. In my constituency, it is too little, too late for many—the Lussmanns has closed in Berkhamsted, as has the Elephant and Castle in Wheathampstead—and we need support from the Government to ensure that more do not close. Does my hon. Friend agree that actions such as the Lib Dems’ proposal to reduce VAT to 15%, at least until April 2027, would be a step towards protecting hospitality before it is too late for others?

[Steve Darling]

I do not know those venues, but I suspect some of them may well be on the high street. We, as Liberal Democrats, know that our constituents see our high streets as the beating heart of our communities. By backing our hospitality industry, we are backing our high streets.

Anthony from Otto in Torquay shared with me how independents are powered by families; they put people first. The reality is that an independent is not going to get a regional chippy in to do some work for him. He is going to take on the chippy who he plays football with on a Sunday morning. He has some skin in the game; he might know that chippy’s kids, because they go to the local sixth form with his kids. As independents, they have a level of skin in the game. That is why we need to ensure that we set up an economy that supports independents. What I found extremely scary when talking with a number of these people this weekend was that they were saying, “Why are we doing this? We could be managers of a local supermarket and sleep at night.” I hope the Minister will listen to these pleas and ensure that the Government do this cumulative impact assessment.

[Robbie Moore (Keighley and Ilkley) (Con)]

I rise to speak to clause 86 and new clause 26, tabled in the name of the official Opposition, which requires the Government to carry out a review of the impact of the increased level of alcohol duty on our pubs and hospitality sector. All these measures will have a cumulative impact on our hospitality and pub sector, because this comes on the back of the huge amount of tax revenue that will be raised from the last Budget—£26 billion-worth, or £64 billion-worth if we take into account the last two Budgets. Alcohol duty alone will bring in an additional £400 million a year—a raid on our pints, spirits and glasses of wine. Alcohol duty is set to rise by an inflation-busting 3.66% at the start of February, equating to a 2p increase on the price of a pint in a pub.

When I am out in my constituency speaking to the landlords of the Dog and Gun in the Worth valley, the Craven Heifer in Addingham, the Airedale Heifer in Keighley or the Black Hat in Ilkley, they all talk to me about the cumulative impact of not only the alcohol duty increase but rising employer’s national insurance, soaring energy costs, increasing minimum wages, the business rate relief reduction not being at the level that was initially indicated and, of course, the tourism tax that is coming down the line. The tourism tax will impact areas like Haworth in the Worth valley and Ilkley in my constituency, where a tax will be collected and go into a generalised pot to be redistributed by the Mayor of West Yorkshire, but I suspect it will not go back into places like Ilkley or Haworth, which are effectively being used as cash cows for the rest of West Yorkshire.

These are all detrimental impacts over and above the alcohol duty. At a local level, on-street parking charges in Ilkley are set to increase at the end of this month. All these things are making it much more difficult for places like the Flying Duck and the Black Hat in Ilkley, where people like to go and enjoy a drink. Disposable income is getting less in my constituency. Labour-run Bradford council has increased council tax by 14.99% in the last two years. People have less money in their pockets, and then we have a Labour Government hitting our pubs and hospitality sector, and boy do they feel it.

Clause 1

Steve Darling Excerpts

Monday 12th January 2026 Commons Chamber

[Dan Tomlinson]

This Government have stuck to their manifesto commitments. We were very clear about not wanting to change the rates of income tax. I have been in discussions with Opposition Members about the wording of our manifesto; I am glad that Conservative Members have taken such interest in it. We are sticking to our commitments. The tax changes that we are discussing now, and others, will allow us to do things such as lift 550,000 children out of poverty this Parliament, by removing the two-child limit and expanding free breakfast clubs and free school meal eligibility. They allow us to cut waiting lists and cut the cost of living by delivering £150 off energy bills. All that would be threatened by Opposition Members, who do not support the taxes needed to fund decent public services.

[Steve Darling (Torbay) (LD)]

Can the Minister explain why there are £300 million-worth of cuts in Devon this year to our NHS—to hospital trusts, our partnership trust that looks after mental health and our integrated care board?

[Dan Tomlinson]

I am not able to comment on the specific figures that the hon. Gentleman raised, but overall the Government are spending significantly more on the NHS in this Parliament each year. That is enabled by the changes to taxation that we announced at this and previous Budgets. One of the challenges that the national health service has today is a result of under-investment in capital for too long, meaning that day-to-day spending is having to take more of the strain. So often in recent years capital budgets have been raided, including when, I should mention, the Conservatives and Liberal Democrats were in coalition. Cutting the capital budgets has left us in the difficult situation that we are in now, and this Government are seeking to turn that around.

Property Taxes

Steve Darling Excerpts

Wednesday 3rd September 2025 Commons Chamber

[Daisy Cooper]

I absolutely agree with my hon. Friend. He will know, as I do from my constituency of St Albans, that many people have spent decades and decades living in their property, which they might have bought for a few thousand pounds. It might now be worth a huge amount, but they might be asset-rich and cash-poor. People in that situation are incredibly scared by the reports they have seen in newspapers of a potential tax of the kind that has been described.

There are parts of the Conservatives’ motion we agree with, however we are open in principle to the idea of a land value tax. In principle, land value taxes can create more fairness in the system and produce a more efficient use of land, but of course, the devil is always in the detail. It would depend on the design of any land value tax and any exemptions that might be introduced. We Liberal Democrats have previously set out policies for how we would replace the broken business rates system with a commercial landowner levy. That is an example of how the principle of land value could be applied to commercial land.

[Steve Darling (Torbay) (LD)]

Many tourism industry businesses in Torbay raise concerns about the impact of Airbnb, both on safety and legality. Surely the Government should publish their long-awaited short-term let registration scheme as a matter of urgency.

[Daisy Cooper]

I could not agree more with my hon. Friend. I would love to see that registration programme, although we Liberal Democrats have repeatedly said that it is only the first step. Registration is something that the Airbnb-type platforms actually want, because it enables them to pinch properties from other platforms. It does not solve the problem we have of lots of additional homes being used as Airbnbs, not by young people—or, in fact, by anybody who wants to be able to rent a property in their area. It is important that local authorities have the power to strike the right balance between tourism and enabling the people they need in their local area to afford to live there.

Business Rates Relief: High-street Businesses

Steve Darling Excerpts

Wednesday 4th June 2025 Westminster Hall

[Steve Darling (Torbay) (LD)]

It is a pleasure to serve under your chairmanship, Ms Jardine. I congratulate the right hon. Member for Stone, Great Wyrley and Penkridge (Sir Gavin Williamson)—that’s the hardest bit of the speech out of the way now—on securing this important debate.

When we reflect on our communities, it is often our town centres that we think about. Whether it is our own communities, which many hon. Members have spoken about with great love, or others that we enjoy visiting, it is often the town centre at the heart of it that we truly love. However, the challenge that we have faced over recent years is the strange death of our town centres, whether that is a result of out-of-town shopping, online shopping or, more recently, the failure under the Conservatives to reform the business rates system. We now need the new Labour Government to step up to the mark and ensure that reform happens.

As many hon. Members have noted, it is clearly not just about business rates. The problem has been exacerbated by the national insurance hike, which has had a massive impact. Many businesses tell me that they are comfortable with the increase in the minimum wage, but the double whammy of national insurance hikes and the lowering of the levy has had a major impact on them. The worry for many Opposition Members, I am sure, is that the current Government see business as a cash cow. If they bleed the cow too much, it will die. That is a real challenge. I ask the Government to reflect on that.

[Gideon Amos (Taunton and Wellington) (LD)]

Does my hon. Friend share my concern about Hatchers department store in Taunton? It was founded in 1775, but because of the combined effects of the change in business rates and the revaluation, it has seen its business rates go up by 144% in one year.

[Steve Darling]

My hon. Friend makes a very good point. I congratulate him on coming from the glorious county of Somerset, where our Liberal Democrat colleagues have had to pick up the pieces after the disastrous Conservative-run council effectively ran it into the ground for many years.

[Sarah Dyke]

As my hon. Friend alluded to, the previous Conservative administration in Somerset was a disaster; indeed, it oversaw an irresponsible record six-year freeze on council tax. Does he agree that the Liberal Democrats in Somerset are now delivering a successfully run administration after a very difficult run of Conservative irresponsibility?

[Steve Darling]

My hon. Friend makes some very powerful points. In my experience, the Conservatives in county councils are more interested in painting the grass greener than in actually getting on and sorting out people’s services.

Back to the main point, we need to be reimagining our town centres. In my constituency of Torbay, a Merlin cinema has appeared where there used to be a department store, and there is an NHS diagnostic offer in our town centre. That reimagining of what the town centre should be about is essential. We have also seen a really popular new pool hall appear in the last few weeks. That is what we need to do to our town centres. Will the Minister do the right thing and undertake a root-and-branch reform of the system to drive the positive change that we want to see?

A couple of businesses have told me about their challenges. A photographer says that he sees no benefit in the doubling of the rates and has had to let a member of staff go due to the national insurance hike. Another business—a gaming café particularly for the LGBTQ community—told me that it is really challenged and is on a knife edge due to the business rates increase; it remains extremely worried.

The Liberal Democrats would like to see a commercial land value levy, which would ensure that we look at the value of the land rather than what is developed on the site. That would lead to a major rebalancing across the United Kingdom and significantly reduce land values in some of our more deprived communities, such as mine in Torbay, driving the productivity and regeneration in our town centres that we desperately need. The only saviour for the Labour Government would be growth in the economy, because that would get us out of the rut that we are in.

I would welcome any assurances the Minister can give us that we will have a root-and-branch reform of the system, rather than tinkering. An element of the Government’s scheme is a cap of £100,000 on what chains pay, and I fear that the books will be balanced on the backs of the poorer independents in our town centres.

Spring Statement

Steve Darling Excerpts

Wednesday 26th March 2025 Commons Chamber

[Rachel Reeves]

To ensure that people are better off, we need to control inflation, which is why stability is so important; bring interest rates down, and the Bank of England has had the confidence to cut interest rates three times since the election; and boost wages, which we are beginning to see, with real wages growing at twice the rate of inflation. That benefits my hon. Friend’s constituents and people up and down the country. That is why we welcome the fact that, today, the OBR has revised up real household disposable income per person by £500.

[Steve Darling (Torbay) (LD)]

Today and last week the Chancellor rushed through severe cuts to the benefits system that will hit some of the most vulnerable in our society. Although we should have considered benefit reform, this is ill conceived. Can the Chancellor explain to the Chamber why she is choosing to balance the books of the nation on the backs of some of the most vulnerable in our society?

[Rachel Reeves]

I have huge respect for the hon. Gentleman, but everybody in this House and across the country can see that the welfare system is just not working. One in eight young people are not in education, employment or training and 1,000 people are going on to personal independence payments every single day, and we cannot carry on like that. The basic principles of this Government are that people who need support should be protected; that those who can work should work and will be supported with personalised, targeted support; and that we need a system that is sustainable. That is what the reforms set out by my right hon. Friend the Work and Pensions Secretary last week deliver. Alongside that, there will be further consultation on the Green Paper to make sure that those with the most severe need get the additional support that they are rightly entitled to.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Steve Darling Excerpts

Consideration of Lords amendments
Wednesday 19th March 2025 Commons Chamber

[Daisy Cooper (St Albans) (LD)]

Notwithstanding what was said by the hon. Member for Loughborough (Dr Sandher), the Lords amendments were clearly not designed with the aim of creating a simpler tax system. They have been sent to us to consider because they may create a fairer society, and that, in my view, should be a driving force in our consideration of them today and in the work of this House.

Such is the strength of feeling in the other place that it has sent us 21 amendments, and such is the strength of feeling on the Liberal Democrat Benches that we will support every single one. Taken together, they offer exemptions for health and care providers, for small charities with an annual revenue of less than £1 million, for transport providers, for children with special educational needs and disabilities, and for small businesses with fewer than 25 employees.

[Steve Darling (Torbay) (LD)]

Rowcroft hospice in my constituency is impacted greatly by the Bill, as is Bay Care, an excellent social care provider. Both those organisations are having to make challenging and difficult decisions about how many people they can employ and how they can support people in their communities. Does my hon. Friend share my fear that this will result in the shunting of costs on to our core NHS services?

[Daisy Cooper]

I agree wholeheartedly with my hon. Friend. One of the main problems with this particular measure is that it is so self-defeating. It is effectively robbing Peter to pay Paul. I have said it once and I will say it again: this jobs tax is damaging to growth, and self-defeating for our health and care services. We Liberal Democrats have opposed it, and throughout the debate on the Bill we have suggested alternative ways—fairer ways—in which the Government could raise the same amount of revenue. We have also asked the Government, if they are indeed pursuing this measure, at the very least to exempt health and care providers.

The Government will not get hospitals out of a financial hole by taxing the GPs, dentists, pharmacies and care providers who prevent people from needing to go to hospital in the first place. The Government will not alleviate the pressure on hospitals by taxing hospices, which will now be forced to withdraw services from people who are trying to die with independence and dignity in a setting of their choosing, rather than in a cramped hospital corridor or a sterile ward. The Government will not keep people out of hospitals by levying a tax on the very health and care charities that provide vital services for those who are vulnerable—warm spaces, friendship for the isolated, financial advice, welfare support and social care. The Minister said that extra money would go into social care, but we know that the money allocated to it in the Budget is dwarfed by the increase in national insurance contributions. We cannot save the NHS unless we fix social care.

National Insurance Contributions

Steve Darling Excerpts

Tuesday 4th February 2025 Commons Chamber

[Steve Darling (Torbay) (LD)]

The Liberal Democrats welcome the Minister’s suggestion that today’s proposals are yoked to the national insurance increases going through the other place. Since the general election, we have had doom and gloom from the Labour party until very recently. The uncertainty around the Budget and the national insurance increases that are yet to hit has only put the cold hand around the economic growth that we need to see pumping harder in our economy.

In my own part of the world in the west country, it is having a massive impact on the tourism industry. The fact that the thresholds at which people start to pay national insurance are going down from £9,200 to £5,000 means that businesses in my constituency, such as Paignton pier, Paignton zoo and Splashdown, all have massive increases in seasonal worker costs, through both the threshold hitting harder and the increases in national insurance costs. When I speak to businesses such as Splashdown in Paignton, they tell me that it means they will probably operate for a shorter time and that they may look at reducing the number of staff they take on. Sadly, the national insurance increase is a jobs tax on our tourism industry, as well as on the rest of our economy.

I am only too well aware that the cost to hospitality is £1 billion. That is extremely disturbing. Again, people will not be taken on due to those cost pressures. Therefore, this really is a jobs tax.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

I am very interested in what my hon. Friend is saying about the threat to jobs. At the other end of the country, the north of Scotland, we have the same issue. The loss of any jobs in the hospitality industry is disastrous, when we do not have much employment anyway. We would like much more—let us put it that way.

[Steve Darling]

I am delighted with my hon. Friend’s intervention, because the Liberal Democrats represent the full length of the United Kingdom from Shetland to the Isles of Scilly, and it is important that we hear about that impact from a breadth of colleagues. The Liberal Democrats represent some of the best places to go on holiday across the UK.

There is a significant high-tech industry in Torbay. Again, businesses in that manufacturing industry tells me that their owners abroad may ask them to offshore some of their manufacturing to places such as Taiwan, where taxes on employment are significantly lower. That is another significant impact of the rise in national insurance contributions.

Bay Care is an outstanding social care business, but Kat Hall, one of its senior managers, tells me that this measure will have a significant impact. The business operates within very tight margins, and it will have to reduce services or limit its offer to our communities in South Devon and Torbay. Those reductions will inevitably have an impact on the social care offer.

Finally, let me say something about the voluntary sector. Torbay Communities gives outstanding service to the people of South Devon and Torbay, but the national insurance increases will confront it with considerable challenges. It will have to think about whether to reduce its staff and stop supporting some of the most vulnerable people in the area—people who are in need. With due respect to the Minister, I ask the Government to reflect on these increases and to see how they can alleviate them, particularly in the hospitality, social care and voluntary sectors.

Agricultural and Business Property Reliefs: OBR Costing

Steve Darling Excerpts

Thursday 23rd January 2025 Commons Chamber

[Mr Speaker]

I call the Liberal Democrat spokesperson.

[Steve Darling (Torbay) (LD)]

After years of the Tories failing our rural communities, including with a dodgy and utterly shameful Australian trade deal, it is a great pity that the new Government have picked up the baton. From Orkney to the Isles of Scilly, Liberal Democrat colleagues are extremely concerned about the impact of these proposals.

The report published yesterday clearly demonstrates the uncertainty about the income from the misguided family farm tax over the next two decades. In the light of this, and given that it will hit older farmers in particular and those who put food on the tables of the United Kingdom, will the Minister do the right thing and scrap this tax?

[James Murray]

The OBR document published yesterday refers to the level of uncertainty associated with this policy, which is exactly what was set out at the time of the Budget, and it is a typical way in which the OBR responds to new measures. What was published yesterday simply reiterates the OBR’s conclusions from the end of October.

Oral Answers to Questions

Steve Darling Excerpts

Tuesday 21st January 2025 Commons Chamber

[Michael Wheeler (Worsley and Eccles) (Lab)]

12. What steps she is taking through the tax system to support the retail sector.

[Steve Darling (Torbay) (LD)]

22. What steps she is taking through the tax system to support the hospitality and tourism sectors.

[The Exchequer Secretary to the Treasury (James Murray)]

The Government announced a range of measures at the autumn Budget to support SMEs, including in the retail, hospitality and leisure sectors. They include more than doubling the employment allowance, freezing the small business rates multiplier, extending RHL relief to 40%, maintaining the small profits rate and reducing the duty on qualifying draught products, which represent 60% of alcoholic drinks sold in pubs.

--- Later in debate ---

[James Murray]

I thank my hon. Friend for his question and for referencing Wonderful Palate, the business in his constituency. I do not know the details of the rateable value of that property, but I point the owner to the fact that we are retaining small business rate relief, freezing the small business multiplier next year and extending the retail, hospitality and leisure relief in 2025-26. I also point the owner of that business and other businesses to our future plan, as I mentioned, to have permanently lower tax rates for retail, hospitality and leisure businesses with values of below £500,000, as well as to consider reforms to small business rate relief to better support businesses that want to expand into a second premises.

[Steve Darling]

What consideration have Ministers given to exempting the seasonal tourism industry from the national insurance hikes set to kick in this summer? That would benefit Paignton zoo and Splashdown in the Torbay constituency.

[James Murray]

We set out the details of our decision to increase the rate of national insurance contributions from employers and to reduce the threshold, and we have added the different benefit we will give, particularly to small businesses and charities, by more than doubling the employment allowance. The employer national insurance contribution changes were among the toughest we took in the Budget, but they were necessary to repair the public finances and deliver the economic stability that is so crucial for investment and growth.