Business Rates and Investment: Call for Evidence

HM Treasury has launched a Call for Evidence inviting businesses, investors, and stakeholders to share their views on how the current business rates system affects investment decisions and what reforms could remove barriers to growth.

The consultation, which runs until 18 February 2026, is part of the government’s long-term plan to transform business rates and create a fairer system that supports economic growth. This follows the publication of the Transforming Business Rates Interim Report earlier this year.

Key areas under review include:

• Marginal Tax Rates: The government is exploring whether moving to a system where successive property bands are taxed at increasing rates could incentivize investment.
• Receipts and Expenditure (R&E) Methodology: Concerns have been raised by businesses with large capital expenditure—such as infrastructure operators—about how this valuation method impacts long-term investment decisions.
• Role of Business Rates in Investment: The consultation seeks evidence on how the current system influences business strategies and capital spending.

The government has already introduced permanently lower tax rates for over 750,000 retail, hospitality, and leisure properties, worth nearly £900 million annually, while large distribution warehouses will contribute an additional £100 million from 2026/27 to support high street retail.

Stakeholders can respond online or via email at [email protected]. The findings will inform future reforms aimed at delivering a modern, investment-friendly business rates system