Budget 2026: live music venues get bigger business rates cut

Relief rises from 15% to 35%

The Budget on Wednesday 28 October confirmed a bigger cut in business rates for live music venues, pubs and social clubs in England. From 1 April 2027 their relief rises by 20 percentage points, from 15% to 35%, the Treasury said in the Budget document.

The government described the move as giving breathing space to the businesses that bring people together. It put the combined value of the relief at an average of more than £3,000 per pub next year. It did not give an equivalent figure for music venues.

The Treasury's own costings put the price of the higher relief at £160 million in 2027-28 and £115 million in 2028-29. The extra 20% cut had first been announced in July, according to the government's Budget press release, and this Budget funds and confirms it.

Business rates are a property tax on commercial buildings, worked out from a rateable value set by the Valuation Office Agency. The Budget document said many retail, hospitality and leisure businesses had been facing significant increases in their bills, and the music plan published in July said sharp cost rises can threaten grassroots venues.

GOV.UK reported this first. Checked against HM Treasury: Budget 2026.

How it got here

The first step came on 27 January 2026, when the government announced a 15% cut in business rates bills for eligible pubs and live music venues in England for the 2026-27 financial year, followed by a freeze in real terms for 2027-28 and 2028-29, according to official guidance for councils. The government said it was responding to recent changes in business rates valuations.

The government's music plan, Turn It Up, published on 13 July 2026, described that package as additional support in response to recent changes to business rates valuations, and said grassroots venues often run on tight margins where sharp cost increases can threaten their survival. The plan cited an average profit margin of just 2.5% for grassroots music venues.

The October Budget then lifted the 15% relief to 35% for all but the largest venues, and added a wider package for high street businesses in retail, hospitality and leisure.

What counts as a live music venue

The relief has a specific legal meaning. Under the government's guidance for councils, a live music venue is a property wholly or mainly used for the performance of live music to entertain an audience. It can be used for other things, but only if they are incidental to the music, such as selling food and drink to the audience, or occasional, such as use as a polling station.

Nightclubs and theatres do not count, even if they put on music, because they fall into separate planning categories. Where it is unclear whether an event is a live performance or recorded music being played, councils are pointed to existing licensing guidance.

A pub, for the purpose of the relief, must be open to the public, allow free entry other than for occasional entertainment, allow drinking without food and sell drinks at a bar. Community establishments that work in practice as a local pub, such as working men's clubs, can also qualify.

The relief is given by local councils using their discretionary powers, and central government reimburses them in full. That means a venue does not apply to the Treasury; its local council applies the relief to the bill. The guidance says the relief is worked out day by day, is applied after any mandatory reliefs, and is not subject to a cash cap.

Because the relief counts as a subsidy, councils must publish details of any single award worth more than £100,000 on the government's subsidy database. Before the scheme started, the Treasury referred it to the Competition and Markets Authority's Subsidy Advice Unit, which reported in March 2026 on whether it met the rules in the Subsidy Control Act 2022.

Who misses out

The very largest venues, those with a rateable value of £1 million or more, do not get the higher rate. They keep the 15% relief already announced for 2026-27, followed by the real-terms freeze for 2027-28 and 2028-29.

In practice that means the biggest arenas and concert halls stay on the earlier terms, while grassroots and mid-sized rooms get the larger cut. The government has not published a list of which venues fall above the £1 million line.

Business rates are devolved, so the change applies to England only. The governments in Scotland, Wales and Northern Ireland set their own rates and reliefs.

The wider high street package

Music venues and pubs are part of a bigger set of changes for retail, hospitality and leisure businesses. From 1 April 2027 the threshold for full Small Business Rate Relief for those businesses rises from a rateable value of £12,000 to £18,000, and the threshold for tapered relief from £15,000 to £21,000. The Treasury said that would take about 70,000 more businesses out of business rates altogether.

All other retail, hospitality and leisure properties will have their bills frozen in real terms for two years, so that increases are capped at inflation in 2027-28 and 2028-29. The Treasury said that, as a result of the package, half of all such properties in England will pay no business rates at all, and about 110,000 will see their bills fall next year.

The government says it is paying for this partly by making online marketplaces collect VAT on sales by UK businesses that sell more than £90,000 through them, and partly by raising Machine Games Duty from 20% to 25% on higher-stakes gaming machines, while keeping the existing rate for the lower-stakes machines common in pubs and seaside arcades.

There is more help for smaller firms coming off older schemes. The Treasury is extending the Supporting Small Business scheme for a further year for about 37,000 small and independent ratepayers who were on the 2023 version, worth an average of £3,000 each. It said the two-year freeze means more than 14,000 restaurants will avoid an extra £7,500 each over two years, and 120,000 shops an extra £3,250. Separately, it is making Small Producer Relief in alcohol duty more generous, worth £10 million a year to more than 2,000 small alcohol producers across the UK.

Why venues matter to the government

Grassroots venues have been a recurring political issue. In her foreword to the music plan, the Culture Secretary Lisa Nandy wrote that in her town, Wigan, almost all the venues where bands cut their teeth have disappeared, and said that could not be right.

The same plan set out the economic case. It said UK consumer spending on live music reached £6.7 billion in 2024, up 9.5% on the year before, driven by arena and stadium tours, but that concertgoers are going to slightly fewer gigs on average.

The plan also called for wider take-up of the live music industry's voluntary £1 contribution on tickets for shows with a capacity over 5,000, with the money going back into grassroots music. It said the LIVE Trust, which handles that money, had already distributed £1.5 million to schemes including the Featured Artists Coalition's touring fund and a Music Venue Trust programme for grassroots venues, and named Harry Styles and the Royal Albert Hall among those who had signed up.

Alongside the rates relief, the government already puts £4 million a year into grassroots music. Its Music Growth Package for 2026 to 2029, first announced in 2025 as a £30 million fund, has grown to £45 million with an extra £15 million from Arts Council England. The plan says it will fund more than 2,000 projects and support more than 40,000 artists and music professionals, including a £4.8 million export scheme run by the BPI.

The plan also promises to strengthen the Agent of Change principle, which is meant to protect existing venues from noise complaints when new homes are built nearby. The housing ministry is to update planning guidance and write to every local planning authority about it, and the government will look at whether the rules on statutory noise nuisance need changing so that complaints are handled more consistently.

A studio campus for Liverpool

The same Budget set aside £20 million from the Growth Mission Fund to restore the long-derelict Littlewoods building in Liverpool as a 260,000 square foot creative campus for film, TV, games, immersive technology and digital screen work, subject to a final business case.

What it means for fans

A lower rates bill reduces one of a venue's fixed costs, but the government has not said what effect it expects on ticket prices, and venues set their own prices. The biggest arenas, where most large tours play, are outside the higher relief.

The relief is likely to matter most to small and mid-sized venues, where the plan says margins are thinnest, and to pubs that put on live music.

What happens next

The 35% relief starts on 1 April 2027. The government has said it will issue separate guidance to councils on delivering the real-terms freeze before the relevant financial years, and that the level of relief will be kept under review alongside the next business rates revaluation in 2029.

Because each council runs its own local scheme under the guidance, venue and pub operators who think they qualify should expect the relief to appear on their 2027-28 bills from their local council, and can ask their council if it does not.