Burnham reflects on tax moves with cut business rates for pubs and high street firms
Andy Burnham, the man expected to enter Downing Street later this month, has told business owners there is “space” to pay the tax, indicating a repositioning of the business pricing system away from the high street and towards online warehouses.
In his first broadcast interview since launching his bid for prime minister, the newly-elected Makerfield MP told LBC’s Andrew Marr that sports venues, clubs and music venues would see a 20 per cent cut in business rates under his plans, while small private, leisure and retail firms would see their rate cap raised for the first time since 2017.
These costs, he said, will be met by higher levies on large distribution houses used by online sellers such as Amazon, as well as measures aimed at owners of empty street spaces, a formula that will be accepted by three restaurants and cafes that close every day under the weight of rising costs and rising taxes.
Crucially for firms planning ahead of the Autumn Budget, Burnham insisted he would honor Labour’s 2024 promises not to raise VAT, income tax or national insurance. “I stick to the charter and the promises you made,” he said. “So, I can’t make it clear, but there is a certain place in that electoral roll for tax travel.”
The intervention comes at a critical time for the sector. From April 2026, the government has replaced retail, tourist and leisure businesses with the lowest ever-low business rates in eligible areas, however UKHospitality has warned that the 2026 review will still leave many operators facing very high debts. Any further exemptions funded by warehouse levies would mark a significant redistribution of the tax burden.
Burnham has also been at pains to improve its economic credibility, a key issue for eight out of ten SME owners who say they fear what a Burnham premiership will mean for their business. He has previously been criticized for suggesting that the UK “should skip this bond market thing”, while others on the left of the Labor Party are calling for lending rules to be relaxed to fund higher public spending.
Pressed on the point, Burnham insisted he would not be “unscrupulous” about public finances, pointing to Greater Manchester’s “robust” record during his time as mayor and as finance minister in the last Labor government.
The big financial headache that awaits him is to protect himself. Sir Keir Starmer this week announced a £15bn increase in defense spending without fully explaining where the money would come from, leaving whoever Burnham appoints as chancellor to find at least £4.7bn in savings from other departments in their first Budget this autumn.
“I haven’t been in all the discussions, but to be fair, the government has had an internal process going on,” Burnham said. “What I can tell you tonight is that I will take my full responsibility to fund the defense investment program, if I am in a position to do so.”
Conservative leader Kemi Badenoch accused Sir Keir of “leaving this mess to his successor” and said the deficit should be eliminated through cuts to the welfare bill rather than new taxes. Burnham, on the other hand, ruled out “unreasonable cuts in favor of levels that simply put people struggling in extreme poverty”, and said instead he would reduce the benefits bill with better technical education, job placement for 16-year-olds and mental health support for those in work.
Burnham remains the only candidate to succeed Sir Keir as Labor leader and is expected to become prime minister on July 20. He has yet to name his chancellor, amid speculation that the role could go to Ed Miliband, and his support in some parts of the industry is already building, with the night-time industry union challenging his demand for VAT cuts.
For SME owners, the message from the embattled prime minister is a typical political balancing act: no move on the big three taxes, but a clear sign that the way business property is taxed is about to change, with the highway a target winner and a target payer.
