Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the impact of business tax rates on small businesses; and what plans they have to adjust these rates to better support small enterprises.

The Government has carefully considered the impact of business tax rates on businesses, within the context of the difficult fiscal inheritance and the need for businesses to help contribute to fixing the foundation and repair our crucial public services.

The Government recognises the vital role that small businesses play in supporting the economy and local communities.

At the Budget in October the Chancellor introduced a range of measures to support small businesses. These included:

• More than doubling the Employment Allowance to £10,500. This means more than half of businesses with NICs liabilities will either gain or see no change this year.
• Maintaining the Small Profits Rate and marginal relief at their current rates and thresholds, as well as maintaining the £1 million Annual Investment Allowance; and
• Freezing the small business multiplier for 2025/26 meaning that, taken together with Small Business Rate Relief, over a million properties are protected from inflationary bill increases.

Looking forward on business rates, we intend to introduce permanently lower tax rates for retail, hospitality & leisure properties with rateable values under £500,000, including those on the high street, from April 2026.

The Government keeps all areas of the tax system under review. Any changes to the tax system are announced as part of the annual Budget process.