2,000 Salons Could Pay Zero Business Rates Under Budget Plan

An estimated 2,000 hair and beauty salons across England could stop paying business rates entirely if the Autumn Budget raises the Small Business Rates Relief zero-rate threshold from £12,000 to £18,000 in rateable value on October 28.

According to a report in The Times, Prime Minister Andy Burnham and Chancellor of the Exchequer John Healey are expected to honour a summer campaign pledge when they deliver the Budget, lifting the threshold as relief for commercial high-street businesses facing rising operational costs.

What does the threshold change actually mean?

Analysis by tax firm Ryan puts the scale of the reform at roughly 75,000 small commercial properties pulled out of the business rates system entirely — independent beauty and hair salons alongside cafes and retail shops.

The mechanics matter here. Rateable values reflect the estimated annual market rental value of a commercial property, not overall business turnover. So a salon sitting in modest premises with a rateable value under £18,000 would move from paying rates to paying nothing at all.

There's a taper built in, too. The Government reportedly intends to phase out relief gradually for properties with rateable values between £18,000 and £21,000, rather than cutting support off at a cliff edge. Salons just above the new threshold keep partial relief instead of losing it overnight.

Takeaway: if your salon's rateable value sits under £21,000, this Budget touches your premises costs directly.

Does this apply across the UK?

No. The reform applies exclusively to businesses in England, because business rating policy remains devolved in Scotland, Wales and Northern Ireland. Salon owners outside England won't see their rates change under these plans.

How is the sector responding?

The National Hair & Beauty Federation (NHBF) welcomed the potential tax relief while pointing to the pressures still weighing on employers.

Fiona Johnston, NHBF president, said: "We welcome any tax reduction for our sector at a time when a significant proportion of salons are struggling."

The federation's own data shows why. Its September State of the Sector Employer Survey found 39.7% of employers had reduced their workforce in the preceding three months, against just 4.8% that increased staffing levels. That's nearly eight salons cutting staff for every one hiring — a ratio that frames rates relief as breathing space rather than a cure.

Takeaway: the sector sees the reform as helpful, but hiring conditions remain the bigger problem.

What should salon owners do now?

Operators can review their current property valuations and check their existing relief status through the official Government Business Rates Relief portal. Knowing your rateable value before October 28 tells you immediately whether you fall under the new zero-rate band, inside the £18,000–£21,000 taper, or outside the relief altogether.

Takeaway: a five-minute portal check now tells you exactly where the Budget leaves your salon.

The Treasury is expected to confirm the threshold rise, the taper band and the full rates package when the Budget lands on October 28.