According to an analysis by tax firm Ryan, retail, leisure, and hospitality businesses in the East Midlands will pay an extra £57.85 million in business rates from 1 April following a government cut to tax relief.
The business rates discount for eligible firms is set to drop from 75% to 40% for the 2025/26 financial year, with relief reduced from £2.41 billion to £1.38 billion across England. The East Midlands is among the hardest-hit regions, alongside London (£309.65 million) and the South East (£157.85 million).
The tax increase comes as businesses already face rising National Insurance contributions, an increased National Living Wage, and a new packaging levy, all of which take effect in April.
Local councils are expected to collect £27.8 billion in business rates in 2025/26, up 5.7% from the previous year. Two-thirds of the increase is due to the reduced discount for retail, leisure, and hospitality firms.
Business leaders warn that small and independent businesses in the East Midlands could struggle to absorb the extra costs, putting further pressure on a sector already battling inflation and economic uncertainty.
