Highlights
- Tesco CEO Ken Murphy supports pubs struggling with business rates after Covid relief ended.
- Average pub business rates bill to rise 76 per cent over next three years following Chancellor's Budget shake-up.
- Labour's Pat McFadden refuses to rule out changes to property tax system amid mounting pressure.
Tesco chief executive Ken Murphy has backed Britain's struggling pubs in their battle against business rates increases, urging ministers to urgently reform the "fundamentally unfair" taxation system.
Murphy said pubs were suffering from higher property taxes after the end of Covid-era rates relief, which has added further costs to stretched landlords already grappling with minimum wage rises and increased employers' National Insurance contributions.
"The Government needs to support the industries and the businesses that get people on the ladder of a career and jobs for life, and be fair and equitable about it," he told The Telegraph.
The average pub is expected to see its business rates bill rise by 76 per cent over the next three years following a system shake-up unveiled by chancellor Rachel Reeves in her November Budget.
The increases are set to push many landlords over the edge, with at least one pub expected to close each day this year.
Murphy said Tesco was advocating for a "fair rates system" for the entire hospitality sector, adding it had been "fundamentally unfair for well over a decade now".
He noted, "I believe that the Government needs to look at the rate system overall and reform it properly."
Political response
Labour's Pat McFadden signalled on Thursday that the Government was listening to calls for change. Speaking on BBC Radio 4's Today programme, the Work and Pensions Secretary refused to rule out changes to the property tax system when pressed twice, stressing Labour wanted "to help pubs".
"We do appreciate the role of the pub in British life, it's something we value," McFadden said. "Believe it or not, we're human beings as well as politicians, so we understand the role that pubs play."
The comments follow The Telegraph's campaign this week to save British pubs by demanding ministers ease their business rates burden.
Murphy argued retailers pay disproportionately high business rates compared to their property holdings. "Retail is about 5 per cent of rateable properties and we pay 20 per cent of the rates bill.
Tesco is one of the largest rate payers in the country, we pay £700m a year in rates," he said.
The remarks came as Tesco reported gaining its highest grocery market share in over a decade at 28.7 per cent.
