More than 2,400 Birmingham shops, cafés and pubs set to stop paying business rates

More than 2,400 shops, cafés, pubs and salons in Birmingham could stop paying business rates altogether from April 2027, more than in any other council area in England, according to new analysis of last week's Budget.

The research, by BusinessRateChecker and reported by TheBusinessDesk.com, looked at the Valuation Office Agency's rating list. It found 2,417 retail, hospitality and leisure properties in Birmingham fall within a newly widened relief band, worth an estimated £10.4 million a year to the businesses that occupy them.

What changed in the Budget

Chancellor John Healey raised the threshold for 100% small business rates relief for retail, hospitality and leisure properties from a rateable value of £12,000 to £18,000, starting on 1 April 2027. The government expects around 70,000 businesses across England to stop paying business rates as a result.

In Birmingham, the change affects around 18% of the city's retail, hospitality and leisure properties, with a typical business saving around £4,300 a year.

Shops benefit most

Shops make up the large majority of the Birmingham properties set to benefit, accounting for 2,025 of the 2,417. They are joined by 130 restaurants, 52 salons and 50 cafés.

Birmingham's total is almost double that of the next highest councils, Cornwall and North Yorkshire, which have just over 1,200 qualifying properties each. The city tops the table partly because of the size of the council area and the large number of small, independent businesses in its high streets and local centres, from Harborne and Kings Heath to Erdington and Soho Road.

Measured as a share of each council's properties, outer London boroughs benefit the most, with more than a quarter of their retail, hospitality and leisure properties falling into the new band.

A note of caution

The analysts say their figures are an upper estimate. Relief is only available to businesses that occupy one property, or one with a small second property, and the data cannot show who occupies which premises. BusinessRateChecker said the real number is likely to be around a quarter lower, which would still mean well over 1,500 Birmingham businesses paying nothing.

What it means for local high streets

For a small shop or café, a saving of around £4,300 a year can be the difference between taking on another member of staff, investing in the premises or simply staying open. With many independent businesses still under pressure from rising costs, the change offers welcome relief to exactly the kinds of places that give Birmingham's neighbourhood high streets their character.

The relief does not start until April 2027, and businesses usually need to apply to their council to claim small business rates relief, so owners are advised to check their rateable value and look out for guidance from Birmingham City Council nearer the time.