According to business rates experts at Colliers, the horse racing industry may be the latest victim of the government’s new business rates policies, set to come into effect in April 2026. This warning comes as the government recently published detailed guidance on the new retail, hospitality, and leisure (RHL) lower business rates multipliers, which will coincide with the 2026 revaluation.
The purpose of these lower multipliers is to compensate the sector for the loss of RHL business rates relief, which has been in place since before the COVID-19 pandemic. The relief, which was initially 100%, has been reduced to 75% in subsequent years and will be completely removed in April 2026.
Under the new system, there will be two lower business rates multipliers for RHL properties in England with rateable values (RVs) below £500,000. These include a small business multiplier for properties with a RV under £51,000 and a standard multiplier for properties between £51,000 and £499,999. The government has stated that the new small RHL business multiplier will be up to 10p in the £ lower than the standard multiplier announced at the Budget.
However, the government’s guidance also includes a list of categories that will not qualify for the new multipliers, one of which is the horse racing industry. Despite being able to claim RHL relief in the past, racing yards will not be eligible for the new lower multipliers. This is due to the government’s definition of eligible properties, which only includes those that are “wholly or mainly” used for in-person retail, hospitality, or leisure activities for “visiting members of the public.”
According to John Webber, Head of Business Rates at Colliers, this decision could have devastating consequences for the industry. “For most yards, this change will mean a return to full business rates liability, which could be crippling,” he explains. “Trainers operate on small margins, and adding on increased business rates costs could push many over the edge.”
Colliers estimates that rates bills for the sector will increase by at least 40%, with an average increase of over £7,000 per yard and a total increase of over £10 million next year. This will have a significant impact on the industry as a whole.
Another category excluded from the new multipliers is betting shops, which indirectly affects the horse racing industry. With over 6,000 bookmakers in the country, Colliers estimates that they could be paying over £10 million per annum in business rates when the new multipliers are applied in April 2026. This will have a knock-on effect on the horseracing industry, which already faces challenges from the government’s business rates strategy.
Furthermore, the Chancellor has announced a potential hike in the tax on gambling firms in the upcoming Budget, which could lead to the closure of all 1,287 Betfred shops in the UK and put 7,500 jobs at risk. Other bookmakers have also expressed concerns, stating that such taxes are unsustainable on top of the recent hike in employers’ national insurance.
Commenting on the government’s new multipliers policy, Webber said, “The list of eligible properties appears to be quite arbitrary. We are not sure why there is a distinction between casinos, gambling halls, and bingo halls, which will qualify for the lower multiplier, and betting shops, which will not.”
He also points out the exclusion of some businesses, such as physiotherapists and opticians, from the list of eligible properties, despite offering in-person services. This lack of clarity and consistency in the government’s decisions is a cause for concern for businesses.
Webber concludes, “The government’s business rates policy has become increasingly complicated and is in need of fundamental reform. By removing the local authority’s discretion in determining eligibility, they are limiting their ability to support local industries outside of the list. The constant changes and lack of consultation only create confusion and harm for businesses.”
It is clear that the government must rethink its approach to business rates and consult with the industry in a more meaningful way to avoid further damage to the economy. The current piecemeal changes and lack of consideration for the consequences of these decisions are not sustainable for businesses or the country as a whole.
Derick is an experienced reporter having held multiple senior roles for large publishers across Europe. Specialist subjects include small business and financial emerging markets.