Business rates pressures are not being felt equally across the economy in 2026. The sectors most exposed so far are hospitality, manufacturing and logistics, while high-value offices and large warehouse operators are also coming into sharper focus as the new political debate around tax and growth gathers pace.
That matters because the conversation is no longer just about the mechanics of the business rates system. It is now also about which parts of the economy are being asked to shoulder more of the burden, and what a new government under Andy Burnham may do to rebalance it.
Hospitality is still under the most pressure
Hospitality remains the sector most clearly under strain. The British Chambers of Commerce (BCC) found in a survey earlier this year that 49% of hospitality firms were worried about business rates, the highest level of concern across the sectors surveyed.
That concern is understandable. Pubs, restaurants, cafés and hotels are property-intensive businesses with tight margins, so even modest changes in rates can have an outsized effect on profitability and trading decisions. Burnham has already signalled sympathy for the sector, saying he would cut business rates for pubs and smaller hospitality businesses and raise the threshold for relief.
Manufacturing faces fixed-cost strain
Manufacturing is another sector feeling significant pressure. The issue here is structural rather than cyclical. Manufacturers often occupy large, specialist premises, so rates can become a major fixed overhead that is difficult to reduce without changing the site, the operation or the business model.
That is why business rates are not just a tax issue for manufacturers; they are a site-selection and investment issue too. If Burnham does push ahead with a shift toward lower rates for smaller businesses, larger industrial users may still find themselves bearing more of the load.
Logistics is watching closely
In the BCC survey, logistics is also close behind, with 43% of firms in the sector worried about business rates. That is important because warehousing and distribution are exactly the kind of property types now being discussed in the political debate over how to fund any future cuts for smaller high street businesses.
Burnham has already floated the idea of higher business rates on warehouse-based companies to help fund reductions for pubs and high street businesses. That makes logistics one of the most politically exposed sectors in the current conversation, especially for firms occupying large, efficient but highly rated sheds.
For occupiers, the message is clear: rates pressure is no longer just about retail decline or high street support. It is also about whether large-format distribution property becomes a policy target in its own right.
Offices and high-value property are in the frame
The pressure is not limited to hospitality, manufacturing and logistics. New commentary suggests higher-value offices and large commercial properties are also vulnerable, especially where businesses occupy high-rateable-value premises.
That matters because some of the political rhetoric around business rates reform has focused on “online giants” and big warehouse operators, but the practical effect may be broader. Large flagship sites, major office buildings and high-value premises in strong locations can all end up closer to the policy firing line.
Why this matters now
For occupiers, the issue is not simply whether business rates go up or down, but where the pressure lands. Hospitality is most visibly exposed, manufacturing and logistics face structural cost pressure, and larger offices and warehouse users may become the sectors that fund any future softening for smaller businesses.
For now, the big picture is that business rates in 2026 are becoming a question of balance rather than simple reform. Hospitality is still feeling the sharpest pressure, manufacturing and logistics remain exposed through their property footprints, and larger offices and warehouse occupiers may increasingly be asked to carry more of the load if policy shifts further toward protecting smaller high street businesses.
For property or business owners, now is the time to review your current Rateable Value, stress-test future liabilities and assess whether your property mix could be more exposed to future sector-specific pressure. If you are planning a letting, acquisition, relocation or expansion, a business rates review can help you spot opportunities to reduce unnecessary costs and make better-informed property decisions. Contact us.
