STATEMENT ON RATES REVAL BY CHAIR OF HU
23 January 2026
Michael Cadden, Chair, Hospitality Ulster, said:
"The Northern Ireland hospitality sector is trapped in an economic pincer movement, driven by a valuation system that has become detached from the reality of running a business in 2026.
As we review the draft lists for the upcoming revaluation, it is clear that Land & Property Services (LPS) is using a model that effectively treats the cost-of-living crisis as a business success.
"As Chair of Hospitality Ulster, I am challenging the LPS to address the fundamental flaws in how they calculate our rates. Business rates for our pubs are based on estimated trade figures known as Fair Maintainable Trade. This is a hypothetical turnover figure that LPS assumes a business should achieve. However, in an era of 30–40% inflation in core costs, these estimated turnover figures are being pushed higher simply because prices have risen. LPS is valuing us on our "top line" while completely ignoring the devastation on the bottom line.
"While LPS estimates our trade, they are failing to account for the reality of the 'Payroll Pincer'. Over the last five years, total wage costs have surged by over 25%, with the National Living Wage reaching £12.71. Furthermore, the recent hike in Employers’ National Insurance (NICs) to 15% and the slashing of the earnings threshold has added roughly £2,500 in annual tax per full-time employee. These are not maintainable costs; they are a direct drain on the very trade LPS is trying to tax.
"We are witnessing the creation of a dangerous two-tier economy on this island. While the Republic of Ireland maintains a competitive environment with significantly lower VAT for food, and England introduces permanently lower business rate multipliers for hospitality, Northern Ireland is becoming a high-cost outlier. We are asking our local businesses to compete on a global stage while the LPS model hangs a millstone of 'estimated' tax around their necks.
"Nowhere is the failure of the FMT model more evident than in the Fermanagh market. LPS’s 'estimated trade' figures for rural venues often fail to account for the unique ceiling on rural pricing. To remain competitive, Fermanagh operators must keep prices lower than their city counterparts, yet they face the same 'big city' payroll taxes and NIC hikes. There is no 'Fermanagh discount' on the National Living Wage, yet LPS continues to estimate trade as if these businesses enjoyed the high-volume, high-margin environment of more affluent areas.
"The 2026 revaluation lists show a sector facing a cliff-edge. For many, Rateable Values (NAV) are doubling not because businesses are thriving, but because the price of a meal or a drink has had to rise just to keep the doors open. This is a monumental transfer of wealth from local small businesses to the Treasury."