The government has announced a 20% cut to business rates for pubs, clubs and live music venues - but many believe more needs to be done to revive the industry.

‘VAT must be next’. That was the reaction of one Northumberland pub owner to the news that pubs, clubs and live music venues will receive a 20% cut to their business rates from April.

An announcement by new Prime Minister Andy Burnham has revealed that 32,000 venues are expected to benefit from this cut, saving a typical pub £1,100 per year.

“For too long, governments have stood by while cherished venues have disappeared from our local high streets. So today I am changing that,” the Prime Minister said.

ORRELL, ENGLAND - JUNE 05: Labour's Makerfield by-election candidate Andy Burnham buys a pint of Guinness during a campaign event at the Holt's Arms on June 05, 2026 in Orrell, England. Andy Burnham is the official Labour Party candidate for the upcoming Makerfield by-election, scheduled to take place on Thursday 18 June 2026. The election is being seen as Burnham's intended route back to the House of Commons, positioning him to launch a leadership challenge against Prime Minister Sir Keir Starmer (Photo by Christopher Furlong/Getty Images)

placeholder image — ORRELL, ENGLAND - JUNE 05: Labour's Makerfield by-election candidate Andy Burnham buys a pint of Guinness during a campaign event at the Holt's Arms on June 05, 2026 in Orrell, England. Andy Burnham is the official Labour Party candidate for the upcoming Makerfield by-election, scheduled to take place on Thursday 18 June 2026. The election is being seen as Burnham's intended route back to the House of Commons, positioning him to launch a leadership challenge against Prime Minister Sir Keir Starmer (Photo by Christopher Furlong/Getty Images)

“This government will back the businesses that people want to see in their communities. I said I would protect pubs and local high streets – the beating heart of our communities – and that’s what we will do. What we’re announcing today is just the start as we work to bring back hope across the country.”

Whilst news of this cut has been welcomed by those in the hospitality sector, many have criticised it for not going far enough to save ever-closing profit margins that pubs and clubs are facing up and down the country.

Speaking to the Northumberland Gazette, Gareth Rose, who owns Paddy’s Bar in Morpeth among a number of other food and drink places across the county, called on more to be done to revive the hospitality industry: “This is just the start of many hospitality tax cuts that they should be doing for hospitality businesses, especially food businesses.

“The 20% VAT that hospitality pays is absolutely scandalous. You’re buying raw produce without VAT, you’re spending money on wages and bills to turn that food into a meal and then you’re getting taxed 20% on that meal itself.

“You’re getting hit from both sides and not getting any VAT relief on the purchase, but you’re getting stung again on the net earning of that meal.

“That’s what the government should be pushing for. [A cut] in business rates is fantastic to support local businesses, but from the standpoint of a small business owner and for any that has anything to do with food, the VAT is what cripples businesses.”

Similar sentiments were shared by Nick Mackenzie, CEO of Greene King who said: “Pubs have long faced disproportionately higher business rates and today’s announcement is much needed relief.

"It’s hugely encouraging that the Prime Minister has chosen to prioritise our sector in his first few days in office, recognising our potential to support local economies and provide jobs in the heart of communities.

"We look forward to working with him over the weeks ahead to build on this support and deliver much-needed long-term reform on unfair taxation for the sector, including business rates, VAT and duty.”

Meanwhile, Lawson Mountstevens, Managing Director, Star Pubs added: "This is a hugely positive step from the new Prime Minister, coming off the back of a World Cup month where people demonstrated just how much they love their locals.”