Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if she will make an assessment of the potential cumulative impact of the (a) increase in National Insurance contributions, (b) changes to the level of retail, hospitality and leisure rate business relief from 2025-26 and (c) changes to the business rate surcharge on properties above £500,000 Rateable Value from 2026-27.

To repair the public finances and help raise the revenue required to support public services, the Government has taken the difficult decision to increase employer National Insurance.

The Government recognises the need to protect the smallest employers which is why we have more than doubled the Employment Allowance to £10,500, meaning more than half of businesses with NICs liabilities either gain or see no change next year.

A Tax Information and Impact Note that covers the employer NICs changes was published by HMRC on 13 November 2024.

Without any government intervention, Retail, Hospitality and Leisure (RHL) relief would have ended entirely in April 2025, creating a cliff-edge for businesses. Instead, the Government has decided to offer a 40 per cent discount to RHL properties up to a cash cap of £110,0000 per business in 2025-26 and frozen the small business multiplier.

From 2026-27 we intend to introduce permanently lower tax rates for retail, hospitality, and leisure (RHL) properties with rateable values below £500,000. This tax cut must be sustainably funded, and so we intend to introduce a higher rate on the most valuable properties on 2026-27 - those with rateable values of £500,000 and above. These represent less than one per cent of all properties, but capturing the majority of large distribution warehouses, including those used by online giants.

The Government will confirm the rates for the new multipliers at Budget 2025.

Tax policy and legislation is not subject to the Better Regulation Framework Guidance which requires an Impact Assessment to accompany policy decisions. Nevertheless, when the new multipliers are set at Budget 2025, HM Treasury intends to publish analysis of the effects of the new multiplier arrangements.

The Non-Domestic Ratings Bill sets out the parameters within which the government proposes the multipliers would be set by Treasury regulations.