Treasury offices to receive business rates cut as pubs face jump in bills

The Treasury’s offices are to benefit from reduced business rates despite overseeing changes to the property tax regime which will lead to soaring bills for thousands of pubs.

The increase comes despite most large offices across Central London facing an increase in tax liabilities from April.

Analysis of official Government figures by tax firm Ryan indicate the Treasury’s office will see its annual bill decrease by £288,180 in the 2026/27 financial year.

1 Horse Guards Road, home to HM Treasury, saw its property value increase by 4% but its bill will drop to £9.62 million for next year as it benefits from changes to the multiplier used to calculate rates and changes to the tax base of rateable properties.

A Treasury spokesman said: “Property valuations for business rates are calculated independently by the Valuation Office Agency.

“HM Treasury will be paying a higher multiplier next year to help fund a lower rate for the high street, as part of the Government’s commitment to rebalance the business rates system.”

In November’s budget, the Chancellor said business rates would be “permanently lower” for small retail, hospitality and leisure businesses, but this has been challenged by sector bosses over the past two months.

The Treasury reduced the multiplier used to calculate the property tax but also confirmed it would end a 40% discount for hospitality, retail and leisure firms from April.

These will be replaced by transition relief measures but these will be phased out by April 2029.

The business rates changes also included new property valuations for 2026, which resulted in a significant jump in the average value of hospitality businesses, including hotels and pubs.

The Government faced criticism from industry bosses and trade groups who warned that the tax changes would lead to closures and job losses across the UK.

British pubs will see their rates bills rise from next year after their rateable values increased by 32%, according to VOA data.

The Government has indicated it plans to provide further financial support for pubs in the coming weeks in response to their concerns.

Other sectors, such as hotels, have issued fresh pleas over fears they could miss out on any relief.

Tax experts say other office buildings are also expected to face business rates hikes as part of the overhaul.

Alex Probyn, practice leader for Europe and Asia-Pacific property tax at Ryan, said: “Across the seven principal Central London office districts, an 11.9% rise in rateable values generates £607.9 million of additional rateable value.

“Even after lower multipliers and transitional relief, that still results in a £78.7 million increase in business rates liabilities in 2026/27 once supplements are taken into account.”