Report Projects 2,076 U.K. Hospitality Closures in 2026 Amid Rising Business Rates

UKHospitality projects that 2,076 hospitality venues could close in 2026 if no sector-wide business rates solution is implemented.

UKHospitality has released new modelling indicating that 2,076 hospitality venues in Great Britain could close in 2026 if the government does not introduce a sector-wide solution to address business rates increases scheduled for April.

The analysis forecasts the following closures in 2026:

• 963 restaurants
• 574 hotels
• 540 pubs

The modelling is based on site numbers of licensed premises in Great Britain, using NIQ’s Hospitality Market Monitor. The 2026 closure rate was determined using factors including the current closure rate, projected increases in rateable values for hospitality categories, and survey data from UKHospitality members on business failure rates.

According to the data, the average hotel is expected to see its business rates increase by £28,900 next year and by £205,200 over the next three years, representing a 115% increase. The average pub is projected to face a 15% increase in business rates next year, equivalent to an extra £1,400, and a 76% increase over three years, or £12,900.

UKHospitality has called on the government to increase the business rates discount for hospitality properties from 5p to 20p, the maximum permitted by law. The organisation states that this measure is necessary to prevent widespread closures and to address the disparity between high street and online businesses.

The proposed changes are intended to take effect before the scheduled business rates increases in April. UKHospitality’s modelling suggests that without intervention, an average of six hospitality venues could close each day in 2026.

The report comes as the sector faces additional cost pressures, including increases to National Insurance contributions, wages, and energy costs. UKHospitality continues to engage with government officials to advocate for changes to the business rates system.

Further information and support tools on business rates are available to UKHospitality members via the organisation’s business rates support hub.