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Column for Bexhill Observer: Pubs, cafés and shops struggling under Labour’s hidden tax hikes

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Tuesday, 27 January, 2026
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Kieran visiting the Castle Inn in Pevensey

Over the past few months, I have spoken to many local business owners across Bexhill, Battle and our villages, from pub landlords and café owners to shopkeepers and small hospitality venues. The message is clear: costs are rising, margins are tight, and it is getting harder to keep going. These are hardworking people doing everything they can to stay afloat, but they are being squeezed from all sides.

Last summer, I ran a campaign to celebrate our local pubs and had the pleasure of visiting many across Bexhill and Battle. I know how vital pubs are to our communities; they are local hubs, create jobs and bring people together. It is not just about keeping the lights on; it is about preserving the heart of our towns and villages.

That is why business rates matter so much. This tax is one of the biggest fixed costs facing many retail, hospitality, and leisure businesses. Decisions taken in Westminster have a direct impact on whether local firms grow, cut back, or close their doors. In towns like Bexhill, where independent cafés, pubs, and restaurants are such an important part of the community, every extra cost makes a real difference.

Business costs are being pushed up from several directions at once. Changes to National Insurance have added around £7,200 to the average pub’s wage bill, and now business rates are rising as well. Relief for retail, hospitality and leisure firms has been cut back, which means about £1.4 billion a year in extra costs on top of a further £1.1 billion increase the year before. There is also a new surcharge on larger properties such as big shops, hotels and sports clubs. More high street businesses are being hit by this than the large internet giants it was supposed to target. Bills are also going up with inflation. Altogether, this is a heavy tax burden on firms that are already dealing with higher wages, energy prices and supply costs, and for many local businesses it is becoming harder and harder to stay afloat.

Only the Conservatives have set out a clear, pro-business plan to turn this around. We would introduce permanent business rates relief for 250,000 retail, hospitality, and leisure businesses, with 100% relief on properties with a rateable value up to £110,000. That would mean thousands of shops, cafés, pubs, and restaurants paying no business rates at all, giving them room to invest, grow, take on staff, and keep prices down.

You don’t have to look far to see how toxic this has become within Government. Labour ministers and MPs are in open rebellion about the impact their changes will have on high streets. 

If we are serious about economic growth, protecting local jobs, and keeping town centres alive, we need a tax system that supports small businesses. Cutting business rates for retail, hospitality, and leisure firms is a practical, targeted way to do exactly that. Our high streets are more than bricks and mortar. They are local jobs, community spaces, and the character of towns like Bexhill, Battle and our villages. A sensible, pro-business approach to rates would protect all of that and give local firms the confidence to invest in their future instead of worrying about their next bill. 

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Dr Kieran Mullan MP for Bexhill & Battle

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