Hotels facing major rates hike

NORTH Coast hotels are facing a massive rates hike this year thanks to the withdrawal of Covid discounts and Stormont’s revaluation of all non-domestic properties.

According to Janice Gault, of the NI Hotels Federation, the average increase for hotels was likely to be 63 per cent, with a significant number of businesses experiencing even higher rises.

She said the hospitality sector was being forced into an “increasingly untenable balancing act.”

Stormont’s Land and Property Services (LPS) has revalued more than 75,000 non-domestic properties as part of a new list used in calculating business rates - an annual property tax that helps fund public services.

The Hotels Federation says the position for the accommodation sector is especially challenging.

That's because Covid prompted a rates discount to aid recovery and address the uniquely difficult trading conditions faced by the sector. That support has now been withdrawn.

Janice Gault said: “While turnover has increased, it has not kept pace with the very significant rise in operating costs. In 2025, room rates softened alongside occupancy levels and escalating costs can no longer be absorbed by businesses alone.

“These pressures inevitably risk being passed on to the consumer.

“Hotels are acutely aware of the need to deliver value for money, but the sector is now being forced into an increasingly untenable balancing act.”

The hotel and accommodation sector currently contributes over £13million in rates annually, a figure that is expected to rise to circa £25million or more under the proposed new NAVs.

Janice Gault added: “There is a growing perception that the pressures facing the hotel, accommodation and wider hospitality sector are not fully understood.

“Many businesses feel they are being treated as a convenient source of revenue, with insufficient regard for rising costs, the need for ongoing reinvestment, or long-term sustainability.

“The sector’s success is being actively penalised through a short-sighted approach to an industry that has invested around £500million since the end of the pandemic, demonstrating confidence, resilience and long-term commitment.”

The industry is calling on the Assembly to recognise the true economic value of the sector and to reflect this by moderating the scale of the proposed increases.

Angela McGrath, the Commissioner of Valuation for Northern Ireland, said the latest revaluation was about ensuring rates were “distributed fairly based on current rental evidence.”

“Businesses are currently paying rates based on rental levels that reflect the economic and market conditions during the pandemic in October 2021,” she said.

“This year's revaluation updates this position by using more up-to-date rental evidence from April 2024. The majority of non‐domestic properties are expected to see little or no change in their rates liability.”

She encouraged business ratepayers to view the new valuation online.

“LPS will review any new or relevant information ratepayers wish to bring forward now and make updates where appropriate before the new valuation list takes effect in April 2026,” she added.