Approved at the Council meeting on 26 February 2026.

This Council notes

1. In April 2026, the Government introduced three changes to business rates. A revaluation based on market rents as of April 2024, five new multipliers and targeted reliefs. Taking each change in turn:
2. Rateable Value: This is the annual rent a property could fetch on the open market as estimated every three years by the Valuation Office Agency. The revaluations can therefore lead to increases and decreases according to market trends by location and sector. Businesses can challenge a new rateable value if they believe it is not justified.
3. Multipliers: Business rates are determined by a property’s rateable value x national multiplier (poundage) set by the Government.
4. From 2026, the Government moved from a two-tier multiplier system (of 49.9p and 55.5p for properties with rateable values of less and more than £55k) to a five-tier system shown below.
5. This includes two permanently lower multipliers for the retail, hospitality and leisure sectors which are part of a £4.3bn support package to manage changes in rateable values and loss of the Retail, Hospitality, Leisure relief. However, the revaluation changes and new lower multipliers may not necessarily result in higher business rates for businesses in this sector.

   Category	Property type rateable value	2026/27 multiplier
   Small RHL	Retail, Hospitality, Leisure less than £51k	38.2p
   Standard RHL	Retail, Hospitality, Leisure £51 to £499k	43p
   Small Non-RTL	Other Sectors less than £51k	43.2p
   Standard Non-RTL	Other Sectors £51 to £499k	48p
   High-Value	All Properties over £500k	50.8p

6. Targeted support: In addition to the lower multipliers, there are three main relief schemes:
7. Supporting Small Business Scheme 2026-29. This applies when a business has, due to the 2026 revaluation lost some or part of either their Small Business Rates relief, or Retail, Hospitality and Leisure relief, or 2023 Supporting Small Business relief.
8. If eligible, an increase in business rates would go up by the greater of either £800 or the following transitional relief percentage caps: 5% for properties with rateable values of up to £20,000, 15% for rateable values £20k to £100k and 30% for rateable values of more than £100k.
9. It is important to translate revaluation increases of 25% into the payable business rates bills and review what has happened since 2019. For example, in 2019 a shop in the City was the subject of a rateable value of £19,500 and a business rates bill of £6,383 In 2026, the same property has a ratable value of £28,750 and a business rate bill of £7,919, after applying the new multiplier and Supporting Small Business Cap worth £287.50. This amounts to an increase of 24% over seven years against an increase in the Consumer Prices Index of 27.5%.

   Year	Rateable value	Multiplier	Retail Hospitality Leisure Relief	Business rates
   2019	£19,500	0.49	33%	£6,383
   2020	£19,500	0.499	100%	£0
   2021	£19,500	0.499	100% (Q1), 66% (Q2,3,4)	£2,483.54
   2022	£19,500	0.499	50%	£4,865.25
   2023	£23,000	0.499	75%	£2,797.52
   2024	£23,000	0.499	75%	£2,869.25
   2025	£23,000	0.499	50%	£6,886.20
   2026	£28,750	0.38	0%	£7,919.13

   In the intervening years, the shop has benefited from a rates free year, and temporary Retail, Hospitality and Leisure Relief rates from 100% to 50%, and from 2026/27 a new lower and permanent multiplier of 38p in every £ in rateable value.

10. Transitional relief: This caps business rate increases for properties over the three years 2026/27 – 2028/29 as follows:

    Ratable value	2026/27	2027/28	2028/29
    Less than £20k	5%	10% + inflation	25% + inflation
    £20k to £100k	15%	25% + inflation	40% + inflation
    More than £100k	30%	25% + inflation	25% + inflation

11. Pubs and Live Music Venues Relief. For 2026/27 eligible pubs and live music venues will receive after deducting other eligible reliefs a 15% business rates relief. Business rates will be frozen in real terms for two years from April 2027. This additional relief will benefit 89 pubs in the City.
12. The Council serves as the business rates collections authority on behalf of the Government. In the context of the various changes, the Council Collections team has been:
    1. Providing reassurance to businesses concerned about how much their business rates bills will be by signposting them to online calculators and providing estimates and information on the support measures and how to appeal, and
    2. Working to ensure all applicable reliefs and adjustments are applied to the 2026/27 business rates bills which will be issued in March 2026. This will enable all businesses to see how their charge has been calculated and make informed decisions about whether to appeal. However, there may be cases where the exact nature of the business is unknown. Charge payers are encouraged to contact the Council if they believe a relief has not been applied.
13. The Treasury has stated restructuring of business rates for 2026/27 is designed to be revenue neutral overall but shifts the burden from smaller, in-person retail, hospitality and leisure properties to properties with rateable values over £500k, for example distribution warehouses. The British Property Federation claims the overall tax burden will increase by £1.7bn and complained about the burden on big businesses.

This Council believes

14. Neighbourhood shops and local shopping areas provide residents with convenient access to goods and services, are vital for those with mobility issues and without access to a car and contribute to community cohesion and sense of place and belonging.
15. It has a significant responsibility to maintain the viability of its portfolio of local shops and shopping parades, redevelop them as required and secure provision in new developments through planning policies and development management practices.
16. Businesses whose premises are the subject of hard-to-justify increases in rateable values be encouraged to appeal.
17. Businesses with concerns about their eligibility for the various reliefs be encouraged to seek advice from the Council’s collections team.
18. It would be misleading to make claims about ‘massive increases’ in business rates and consequential increases in retail prices, reductions in services and closures in advance of comprehensive evidence of the impacts in monetary terms.
19. It would be prudent to request and review such evidence before any resolution could be justified to make representations to the Chancellor of the Exchequer, Cambridge’s MP’s and Valuation Office Agency.

This Council resolves

20. The Council will use its discretionary relief powers under Section 47 of the Local Government Finance Act (as amended) to grant the Pubs and Live Music Venues Relief and claim full reimbursement from the Government in accordance with its expanded guidance (Business Rates Information Letters 1/2026 and 3/2026).
21. Request officers to provide further information – in monetary terms – on the financial impacts of the new rateable valuations, multipliers and relief schemes on neighbourhood shops, hospitality and leisure sectors.