Foyle MLA highlights Derry closures to demand rates revaluation reversal

The Economy Minister has faced calls to reverse the proposed revaluation of business rates, as MLAs heard “hospitality businesses are closing their doors due to rising costs”.

Sinn Fein’s Dr Caoimhe Archibald said the 2026 revaluation is necessary to ensure “fairness in our rate system”, but that she would request a meeting with the UK Treasury in relation to a potential pilot scheme to reduce VAT for small businesses.

On Tuesday, Treasury minister Dan Tomlinson said the property tax bills for pubs and music venues in England will be reduced by 15% in 2026/27 and then be “frozen in real terms” for the next two years.

Last week the Department for Finance headed by Sinn Fein’s John O’Dowd announced Reval 2026, as Land & Property Services (LPS) released a draft list of revaluations for commercial properties.

Properties that have seen above average increases in their value will likely see their overall rating liability increase, resulting in a higher rates bill.

Non-domestic rates generate around £720 million a year, and the Department of Finance says revaluations do not raise additional income but are adjusted to maintain revenue neutrality.

Hospitality Ulster described the move as “unacceptable”, saying in a statement: “At a time when hospitality businesses are battling unprecedented cost pressures, the idea that our sector can absorb significant increases in rates liabilities is utterly detached from reality”.

In the Stormont Assembly chamber on Tuesday, SDLP MLA for Foyle Sinead McLaughlin criticised the potential for rates rises, saying “more and more small retail, pubs and hospitality businesses are closing their doors due to rising costs”.

“Three restaurants in Derry City Centre announced last week of their intention to close because they can’t make the figures all add up,” she said.

“At the same time, your executive colleague is pressing ahead with a rates revaluation, which could push more and more businesses over the edge.

“What assessment have you made of the impact this decision will have on the hospitality, particularly the pub trade, and on tourism and on jobs and in our town and city centre?”

Ms Archibald said she’d had “significant engagement” with the industry, but added that “most of the pressures” they face “are not within our control”.

She said: “Some are the result of decisions that have been taken by the British Government and of course, the increasing pressure in relation to rates comes on the back of all of that and on the challenging years through the pandemic.

“So I do continue to engage with the sector as I said, recently met with Hospitality Ulster and Food to Go along with the finance minister to discuss their proposal around a VAT pilot scheme, given the differential north-south, and the potential impact that that there is there in terms of that increasing negatively over coming months, and what we agreed out of that meeting was that we would seek a meeting with Treasury to discuss that proposal for a reduced VAT pilot scheme.”

Ms McLaughlin, a former chief executive of the Chamber of Commerce in Derry, called on Mr O’Dowd to reverse the rates re-evaluation “before more hospitalities actually hit the wall”, putting it to Ms Archibald that such a move is “the purview of this Executive”.

She said: “This is not something imposed upon you by the British Government.

“This is rates, and that is his job, his role and his decision, and you as an economy minister need to be really concerned, because I genuinely am concerned for those businesses in each and every town across Northern Ireland.”

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In her reply, Ms Archibald said: “Anybody who listened to the finance minister yesterday will be familiar with the reasoning behind revaluations is to ensure there is that fairness in our rate system, to ensure that it keeps up to speed, and one of the asks of the business community was that these revaluations take place on a more regular basis.”

Later in the session, DUP MLA Pam Cameron (South Antrim) asked if the minister accepted that the rise in non-domestic rates would be “devastating for the tourism and hospitality sector”.

Ms Archibald reiterated that she is aware of pressure on the industry and that making “progress in relation to the VAT issue” would be one way to support businesses.

She added: “I know that the finance minister, alongside the work on Reval, is also consulting in relation to small business rate relief and I think there’s an opportunity there to look at how we support the sectors and small businesses more generally.”