2026 business rates revaluation could ‘cripple’ UK manufacturing

At Tadweld, we are warning that the 2026 business rates revaluation will “cripple” UK manufacturing and push many small firms to the brink.

Our Managing Director, Chris Houston, says the April 2026 revaluation will deliver another crushing blow to industrial businesses already under severe cost pressure, forcing many smaller firms to downsize or even close just months after it comes into force.

The 2026 Business Rates Revaluation in England and Wales takes effect on 1 April 2026, with new rateable values based on commercial rental values as of 1 April 2024. While the revaluation is intended to reflect changes in the market since the last revaluation in April 2021, we believe the timing and scale of the increases could not be worse for manufacturers already facing unprecedented cost pressures.

Under the new system, England will introduce five tiered multipliers, replacing the previous two-rate structure, while Wales will continue with its own framework. Although some reliefs may be available for retail, hospitality and leisure (RHL) sectors, industrial and manufacturing premises are expected to be among the hardest hit. Businesses are being urged to check their new rateable values on GOV.UK and consider appeals before the 31 March 2026 deadline for challenging current valuations.

2026 business rates: “A staggering blow to industry”

Chris said the revaluation represents yet another policy decision that disproportionately harms manufacturers:

“Historically, business rates were revaluated every five years – in reality, closer to every 5.5 years since 1990. The government has now moved to a three-year cycle, meaning businesses were hit with increases in 2023 and are now facing further increases again in April 2026. This is relentless.”

Industry data suggests the average increase in rateable values is 19.3%, with retail at 9.3%, while industrial and warehousing businesses face average increases of between 21% and 28%.

“Manufacturing and warehousing are being hammered the hardest. These are exactly the sectors the UK relies on for productivity, exports and skilled jobs – yet they’re being treated as an easy target.”

A ‘triple-punch’ for employers

We believe the revaluation lands at a time when businesses are already reeling from a series of government-imposed cost increases:

• Corporation tax rising from 19% to 25% in 2024
• Major increases in Employer National Insurance contributions in 2025
• A National Minimum Wage increase of 11.1% between April 2024 and April 2026

“Despite claims of being pro-business and pro-growth, this revaluation couldn’t have come at a worse time,” Chris added. “It’s a triple-punch to employers who are already struggling to balance the books.”

Small manufacturers at risk of closure

As an SME steel fabrication business operating across the UK, we employ 50 people from our local community. Chris warns that for many firms of a similar size, the impact could be existential:

“We employ 50 people locally, and at a point where businesses are feeling attacked on all sides by government policy, this is yet another cost increase that has to be found from somewhere. These increases mean less money to invest, less money for staff, and ultimately they hamper our ability to grow and create jobs.”

He added that smaller manufacturers, already operating on tight margins, may have no room left to absorb further increases:

“For many small manufacturers, this will be the tipping point. You can only absorb so much before investment stops, recruitment freezes, or sites simply close. Once manufacturing capacity is lost, it doesn’t come back easily.”

Business confidence at record lows

Chris also pointed to growing evidence that business confidence is collapsing under the weight of repeated policy shocks:

“Unfortunately, businesses have become the ‘sacrificial lamb’, expected to fill the black hole in public finances. The Institute of Directors is now reporting record-low business confidence – lower even than during the depths of the COVID pandemic. That should be ringing alarm bells in Westminster.”

A call for urgent government action

At Tadweld, we are calling on the government to rethink how business rates impact productive industries and to offer meaningful relief for manufacturers ahead of April 2026.

“If the government genuinely wants businesses to grow, invest and improve productivity, it urgently needs to start supporting them rather than continuously handcuffing them. Without change, this revaluation risks doing long-term damage to UK manufacturing that will be felt for years to come.”