Chancellor Rachel Reeves has been urged to “urgently u-turn” on her so-called “pubs tax” as hopes surge that a Government climbdown is imminent. The Government is expected to bow to pressure and make changes to the way pubs' business rates are calculated about to be announced. This comes in the wake of fears that many well-loved establishments will be forced out of business.

A leading campaign group warned this would only be a “sticking plaster” and pushed for Ms Reeves to scrap the increase in employers’ National Insurance Contributions which has pushed up pubs’ wage bills. Labour MPs have been banned from more than 1,000 pubs and Conservative leader Kemi Badenoch has pledged to axe business rates for thousands of pubs if her party returns to power.

Many landlords have seen the rateable value of their premises shoot up at a time when the sector has been hit by mass closures. Labour ministers are under intense pressure to stop an expected average rates rise for pubs of 76% over three years.

Shadow Chancellor Sir Mel Stride said: “Rachel Reeves should urgently u-turn on her disastrous pubs tax. It is yet another bad choice, announced without proper thought for the consequences. Labour's lack of business experience is showing and the Chancellor's punishing rise in business rates is already crushing our pubs and high streets. Over the next three years, business rates will rise by 76% for the average pub, costing thousands of pounds. Any business would struggle to cope with that.”

Mrs Badenoch has also pledged to cut pubs energy bills by an average of £1,000. She told the Telegraph she would “save your local boozer”.

“Like so many of Britain’s small businesses, pubs are being treated by Labour like cash cows to milk instead of as places to protect,” she said. The Tory leader plans to fund the scrapping of business rates for high street pubs by cutting the benefits bill and the size of the civil service.

John O’Connell, chief executive of the TaxPayers’ Alliance, was not impressed by the prospect of a change to how business rates are calculated.

He said: “This is a pitiful sticking plaster from a Government that claims to support pubs and hospitality while strangling the sector with punishing taxes and costs. “After hiking business rates and whacking employers with higher national insurance, ministers are now offering a token retreat and hoping struggling publicans will be grateful, even as many are being pushed closer to the brink.

“If the Government is serious about saving pubs, it must reverse the business rates grab and scrap the employers’ National Insurance hike in full, instead of drip-feeding half-measures while the sector bleeds out.”

Shadow Chancellor Sir Mel said: “Keir Starmer's Labour doesn't have a plan. They announce policy first, discover the consequences later, and then reach for another u-turn. That is not consultation – it is indecision.

"We have set out a clear plan to control spending, particularly the benefits bill, which will allow a future Conservative government to scrap business rates for thousands of pubs, restaurants and shops on our high streets.”

Ash Corbett-Collins, chairman of the Campaign for Real Ale, said:  “Doing nothing and letting pubs go to the wall was never going to tolerated by pub goers, publicans or MPs. The Government must urgently end the uncertainly and announce the extra help and permanently lower bills our locals were promised and need to survive and thrive.” 

A pub landlord with 30 years experience in the trade accused Ms Reeves of "killing" pubs.

Alex Cook, 43, the landlord at The Mill in Stokesley, North Yorkshire, said: "Rachel Reeves is killing pubs and taking away the working person's pleasure. This is not greedy pubs we're talking about, it's a greedy Government."

Mr Cook said his pub will see business rates are on course to go up £1,500 per month from April.

"The industry is on its knees," he said. "Just when we thought our government couldn't get any worse, it gets worse. It's not easy to run a good pub, a proper pub where people feel safe and secure and get value for money.

"There's not a lot of profit in it anymore. It's crazy and heart-breaking. I love this industry. Unfortunately, this industry won't exist in a few years.

"We're getting hit from everywhere. We're fighting against supermarkets selling alcohol at a cheaper rate. Since Reeves took over it's been a mess. It's no longer sustainable."