Farm shops, cafés and holiday lets on diversified farms could pay less in business rates from April 2027 after the Chancellor, John Healey, raised the small business rates relief threshold in Wednesday’s Autumn Budget, though farming leaders said the wider package left family farms “abandoned”.
The 100% relief threshold for qualifying retail, hospitality and leisure properties in England rises from a rateable value of £12,000 to £18,000, with the tapered relief threshold moving from £15,000 to £21,000, according to the Agriculture and Horticulture Development Board (AHDB). Other retail, hospitality and leisure properties will have rates frozen in real terms for two years. The Chancellor told the Commons the change would take 70,000 businesses out of business rates altogether, Farmers Guardian and TTG reported.
The AHDB said “some diversified businesses such as farm shops, cafés and holiday lets may benefit if they qualify for relief”, with eligibility the deciding factor. The National Farmers’ Union (NFU) listed “additional business rates relief for qualifying farm diversifications” among the measures announced.
Other measures with a rural bearing include a further six-month extension of the 3.7p cut in red diesel duty to 1 July 2027, the cancellation of a planned 5p rise in road fuel duty, the suspension of selected fertiliser import tariffs and the removal of the 4% import tariff on kerosene until December 2028. The National Living Wage will rise by 3.9% to £13.21 an hour from April 2027, a significant cost for labour-intensive hospitality and agritourism enterprises. From 2028, mayoral authorities will also be able to introduce an overnight visitor levy.
The Budget made no changes to the reforms to Agricultural Property Relief and Business Property Relief. NFU President Tom Bradshaw said the government had “failed to act and has left farmers feeling abandoned”, describing the package as “tinkering while Rome is burning”. George Dunn, chief executive of the Tenant Farmers Association, called it a “farm-blind Budget”, according to Farmers Guardian.
The rates changes arrive as farm businesses face higher wage bills and continuing uncertainty over succession. For rural communities, the detail of which farm shops, cafés and visitor accommodation qualify will determine whether the relief becomes a meaningful support for rural enterprise or a marginal saving.
