Following the Finance Minister’s decision to pause Reval26 and his clear message that he expects the industry to present an evidence-based case for changes to how hospitality businesses are rated, it is vital that we rise to the challenge and build our case for a fair valuation system for the entire hospitality industry.
During our campaign to highlight the potential impact of Reval26, it was clear that its implementation would have been a devastating blow to the entire hospitality sector. While there was widespread sympathy for smaller businesses, there was a significant misunderstanding of the financial pressures faced by all hospitality businesses, regardless of their size or type. Larger businesses were often viewed as “cash cows” more able to withstand the unsustainable increases in NAV that would have resulted from the proposed changes.
There is no doubt that the sympathy for smaller businesses helped strengthen our case. However, it will be the combined power of the entire industry that will secure a fair outcome for everyone. Failing to present a comprehensive case could result in token levels of relief for one or two years, while undermining any chance of securing a permanent solution for a fair valuation system across the different segments of the industry.
While the three different rating models that apply to pubs/bars, hotels, and restaurants are set at the UK-wide level and cannot be changed locally, the formulas used and the allowances given in each model can be adjusted. At the same time, Hospitality Ulster remains part of the broader UK campaign to overhaul the current non-domestic rating system through Westminster. Our close working relationship with UKHospitality and other UK trade bodies places us in a unique position to ensure Northern Ireland is included in these discussions.
We have now appointed a team of financial, economic, and valuation experts, led by BDO NI, to compile the evidence required. This work will continue over the next few months, ensuring we are well-prepared to respond to the Minister’s request.
Meanwhile, we will be in London this week for a meeting of industry trade bodies from across the UK to establish the largest collaborative Hospitality VAT campaign ever. We will also take this opportunity to further collaborate on the Westminster rates lobby.
Once again, we extend our thanks to all the pubs/bars, hotels, and restaurants that supported our campaign in January. Your efforts in contacting elected representatives and voicing your concerns made a real impact. With much still to do in our efforts to secure a fair system for all business types in our industry, your ongoing support is both appreciated and vital.