The UK government reportedly postponed a proposed reform of business rates that could have alleviated the financial burden on hotels, amid concerns over potential trade repercussions from the United States. Industry representatives said the Treasury is hesitant to impose higher taxes on large online retailers such as Amazon, fearing that such measures might provoke retaliatory tariffs from the US administration under former President Donald Trump.

UK Hospitality chairman Allen Simpson told reporters that officials have indicated reluctance to proceed with business rates adjustments because funding the relief would require increases in taxes on Amazon warehouses. While Simpson did not suggest that Amazon had directly lobbied against the changes or invoked the threat of US tariffs in government discussions, he highlighted the complex interplay between domestic tax policy and international trade relations.

The government has pledged support for the hospitality sector, which has faced significant challenges as business rate bills for hotels more than doubled over a three-year period. Earlier this year, pubs received a discount on business rates, and the upcoming Budget is expected to include new measures to help smaller High Street businesses—including salons and cafes—by exempting approximately 75,000 small properties from paying rates. To finance this, the government plans to implement a tax enforcement initiative targeting online marketplaces, requiring them to collect taxes on behalf of third-party sellers—a move welcomed by Amazon.

Despite these efforts, UK Hospitality has urged the government to extend relief measures to hotels, many of which are disproportionately affected due to their large property sizes subject to the highest business rate multiplier. Simpson emphasized that a value-added tax (VAT) reduction from 20 percent to 10 percent for the hospitality sector would represent the most straightforward and impactful means of support. He added that the Chancellor acknowledged the difficulties facing hospitality at a recent business roundtable, agreeing that the sector—and the High Street more broadly—has endured significant hardship in recent years.

A Treasury spokesperson declined to comment on the specifics, reiterating that tax decisions are ultimately a matter for the Chancellor to announce during fiscal events and that the department does not typically respond to speculation or proposals in the media.