Earlier this morning, the Finance Minister launched a consultation on the Small Business Rate Relief Scheme having previously announced plans to bring forward changes aimed at providing greater support for small businesses, in November.

John O’Dowd said he intended to consult on changes to support for small businesses, outlining his view that the scheme currently provides vital support for operating costs for small businesses.

The consultation sets out options to enhance the scheme using two distinct methods;

Increasing percentage reductions – the current relief levels of 20%, 25% and 50% have remained unchanged since 2012. Where funding allows, the Minister wants to adjust the percentage reduction tiers to deliver great impacts.

Updating valuation thresholds – these have now been reviewed since 2012 and the Minister said there is a need for these to be adjusted to reflect modern rental values, particularly as Reval 2026 marks the fourth revaluation in 11 years.

“Small businesses are the backbone of our local economy and I am committed to delivering positive, progressive changes to the rating system here creating a fair environment for all business sectors, fostering entrepreneurship, boosting occupancy of vacant properties and enabling smaller businesses to flourish,” said the Minister.

“This consultation offers businesses and interested parties the opportunity to share their final views before proposals are presented to my Ministerial colleagues. I would encourage everyone to have their say and help to shape this support and deliver local solutions to local challenges.”

However, the proposed amendments to the scheme have been declared “smoke and mirrors” and not real reform.

“What is proposed is a mere modest adjustment where what we need is an across-the-board reform and substantial reduction in rates for our high streets and other retail hubs,” said Neil Johnston, Director of the Northern Ireland Retail Consortium.

“It looks like the Finance Minister is helping business but the reality is the rate burden continues inexorably upwards.

“The revenue from business rates has rocketed by over £100 million in the past five years to fast approaching £400 million a year,” added Mr Johnston.

“A disproportionate amount of that – well over £100 million – comes from the retail sector. That is a huge burden in an industry that has very small profit margins.

“The Finance Minister’s proposals would increase relief for small businesses – including some retailers – from roughly £20 million to £30 million, an increase of about £10 million. Which set against an increase of 41% or £112 million in the past years means he is going to give back a pound for every extra £10 he is collecting.

“It begs the questions; does the Minister want to revive the high streets of Lurgan and Portadown in his own constituency and the other cities, towns and villages across Northern Ireland? He needs to recognise that the world, especially the retail world, has moved on and he needs to radically reduce the rates burden, not tinker around the edges.

“Many retailers have invested heavily in Northern Ireland in recent years but if this chasm in rates persists, there is a danger that Northern Ireland will not get the same retail investment as other areas which are a more viable proposition.”

This focused consultation will run for eight weeks, closing for responses on 29^th January 2026 in order to continue to facilitate any changes in time for the 2026-2027 rating year.

For more details, visit www.finance-ni.gov.uk/consultations/small-business-rate-relief-sbrr-options

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The Finance Minister said he had been asked to view these as priority areas by businesses here with a view to making the best use of rate support funding.

The Small Business Rate Relief Scheme provides between 20% and 50% rate relief to over 30,000 businesses per annum at a cost of over £21 million, stimulating economic growth, supporting local jobs and encouraging entrepreneurship.

“While this rate relief provides important support, we must also ensure it continues to be targeted towards those who need it most and offers the most effective assistance given the critical role our rating system plays in generating funding for vital central and local government services. It’s important to stress that review does not mean removal,” said Minister O’Dowd.

“Today’s publication of the Terms of Reference is the next step in my Department’s Strategic Review of Rating which will move the focus onto Small Business Rate Relief scheme and Non-Domestic Vacant Rating exclusions and liability level.

“I have been asked to treat these areas as a priority by the business community both in terms of making best use of rate support funding and to address concerns over vacant properties in our towns and cities to aid regeneration.

“The Terms of Reference for 2025/26 builds on discussions already held with business groups in recent weeks by my Department, preparing them for the reviews. That process will use the evidence-base from the research undertaken by the Ulster University’s Economic Policy Centre into the cost of doing business here and allow the Department to gather the latest information on the distribution of current support and formulate policy proposals for consultation in the autumn.”

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Speaking after the Assembly debate on two of the measures on Monday 10th March, Minister O’Dowd said supporting local businesses means supporting entrepreneurship, helping the economy grow and creating better jobs.

“Small businesses are the driving force behind our high streets and the extension of the Small Business Rate Relief scheme means we continue to provide around 30,000 businesses with reductions, of between 20% and 50%, on their rates bill,” said Mr O’Dowd.

“This is just one element of over a quarter of a billion pounds of support provided to business ratepayers through the rating system.

“The Back in Business scheme helps to support entrepreneurship by encouraging businesses to set up in long term vacant properties. The scheme has previously helped cafes, barbers and gift shops to locate in vacant premises, bringing life back to premises that had long been boarded up.

“Furthermore, the retention of the rural ATM exemption will continue to help people to easily access cash, something especially important in rural communities given bank closures.”

The extension of the rate support schemes came on the day the Assembly also approved the 5% and 3% regional rate uplifts for domestic and business rates respectively.

DIFFICULT CIRCUMSTANCES

This means a domestic property with an average capital value of £123,000, will pay 60p a week more on the regional rate element of their bill and for businesses with a rateable value of £50,000, it will mean an additional £8.37 per week on that element.

Highlighting the important role rates play in funding public services, Minister O’Dowd said: “The Regional Rate is expected to raise in the region of £730 million in the forthcoming financial year, this is vital to helping fund our hospitals, childcare, schools and other essential public services.

“This year the rate setting process has been taken under the difficult circumstances following the impact of decisions taken by the Chancellor in relation to National Insurance contributions which have led to well documented concerns over increased costs.

“As a result, the new rates have had to be set carefully to strike the right balance between raising income while limiting increases as much as is possible recognising ongoing challenges for households and businesses. The extensive support we provide for households including means tested supports for those on the lowest incomes will continue.”

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