Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether she has made an assessment of the potential cumulative impact of changes to (a) the Minimum Wage, (b) employer National Insurance, (c) Business Rates and (d) lack of uprating to VAT thresholds on micro-businesses in the hospitality sector since July 2024.

The Government recognises the important contribution that micro-businesses in the hospitality sector make to local communities, the high street and the wider economy. The potential impacts of changes on this sector are carefully considered as part of policy development.

The Government considers the impact of tax measures on these businesses. Where changes are made, relevant impact notes and assessments are published at fiscal events and otherwise as necessary, in line with the Government’s usual practice. The Treasury also engages regularly with the hospitality sector.

To protect the smallest businesses from changes to employer National Insurance Contributions (NICs) made at Autumn Budget 2024, the Government increased the Employment Allowance from £5,000 to £10,500. This means that this year, 865,000 employers will pay no NICs at all, and more than half of all employers will either gain or will see no change.

The Government is also supporting small businesses to grow. At Budget, the Government announced the extension of Small Business Rates Relief (SBRR) so that businesses opening second premises can retain their SBRR for three years, tripling the current allowance.

The Government continues to provide targeted support to the hospitality sector through the tax system and other policies and keeps all areas of the tax system under review, with future decisions taken at fiscal events under the normal process.