Andy Burnham, the mayor of Greater Manchester, has announced a plan to cut business rates for pubs and music venues by 20 percent and abolish them entirely for other small shops such as cafes and hairdressers if he becomes prime minister. the proposal, revealed as part of his campaign to return to Westminster as Labour MP for Makerfield in an upcoming by-election, directly challenges Prime Minister Keir Starmer and Chancellor Rachel Reeves on their economic policies, according to the original report.

The £350 million price tag: how Burnham would fund the cuts

Under Burnham’s proposal, the 20 percent cut for pubs and music venues would begin in 2027-28, costing an estimated £100 million. the complete abolition of business rates for cafes, shops, and hairdressers would add another £250 million to the total, the source reports.. To fund these measures, Burnham suggested raising taxes on online tech giants and their warehouses in the UK, as well as tackling tax evasion that harms high streets.

This comes as the government conducts a revaluation of business rates, which, combined with the removal of Covid-era relief, is expected to increase levies for many small businesses.. Industry leaders have responded positively, but the details of Burnham’s funding mechanism remain vague, as the report notes.

Emma McClarkin and UKHospitality: industry backing but a call for broader reform

Emma McClarkin, CEO of the British Beer and Pub Association,welcomed the additional 20 percent cut, stating that pubs continue to pay disproportionately high rates, according to the original article. She emphasized the need for long-term reform to keep pubs open and support jobs. Allen Simpson, chief executive of UKHospitality, called for a hospitality-wide solution, including lower business rates and a 10 percent VAT rate,noting that the challenges facing local businesses are universal.

The source reports that pubs and music venues received a 15 percent relief package in January after public outcry, but Burnham aims to go further. Industry voices support the move but stress that a piecemeal approach may not suffice for all venue types.

A by-election test : Makerfield as a referendum on Burnham's Labour vision

The by-election for Makerfield will be a key test of Burnham’s support and the viability of his policies, as the source states. Burnham criticized the government for undervaluing the contribution of small businesses and high streets to local communities and the economy, arguing that his party has got it wrong in government. He emphasized the need to reconnect Labour with working-class Britain by supporting family-owned firms and creating a fairer tax system.

This move sets the stage for a debate on the future of small business taxation in the UK and directly challenges Starmer’s leadership, according to the report. The outcome in Makerfield could signal whether Burnham’s populist economic pitch resonates beyond Greater Manchester.

The unresolved question: can taxing tech giants and closing evasion raise enough?

Burnham’s proposal relies on raising taxes on online tech giants and their UK warehouses, as well as tackling tax evasion that harms high streets. However, the source does not provide specific details on how much revenue these measures would generate or whether they are politically feasible. The government’s revaluation of business rates is ongoing, and the removal of Covid-era relief is expected to increase levies for many small businesses, leaving open questions about the timeline and the actual impact on high streets.

Critics may argue that relying on tech taxation could face fierce lobbying, and that closing tax evasion is easier said than done. The plan’s success hinges on whether these funding sources can bridge the £350 million gap without causing unintended economic consequences.