Non-Domestic Rating (Multipliers and Private Schools) Bill: Second Reading

Parliament voted on 25 November 2024 to give the Non-Domestic Rating (Multipliers and Private Schools) Bill its Second Reading, passing it by 336 votes to 175. Second Reading is the first substantive vote on a bill, allowing it to proceed through Parliament. The bill has two main elements: it removes the charitable business rates relief that private schools in England hold under charitable status, from April 2025, and it creates powers to introduce permanently lower business rates multipliers for retail, hospitality and leisure properties from April 2026, funded by higher multipliers on properties with rateable values of £500,000 or more. The vote matters because it advances two significant policy changes at once. Removing charitable rates relief from private schools in England, while retaining an exemption for schools serving mainly pupils with Education, Health and Care Plans, is expected to raise revenue that the government says will help fund a £2.3 billion increase to the core schools budget for 2025-26. For high street businesses, the bill promises a permanent lower rates regime to replace the temporary retail, hospitality and leisure relief that has operated year to year. Without the bill, that temporary relief was set to fall to zero from April 2025 before the government extended it at 40 percent for another year while the permanent reforms are put in place. The vote divided almost entirely along party lines. All 291 voting Labour MPs and 34 Labour and Co-operative MPs backed the bill, along with four Greens and four Independents. Every Conservative and Liberal Democrat who voted opposed it, joined by Reform UK, the DUP, Traditional Unionist Voice, and six Independents. There were no Labour rebels recorded. The Conservatives and Liberal Democrats together account for the bulk of the 175 noes. The bill sits within a wider legislative moment following the October 2024 Budget, and its provisions on private schools connect to a parallel debate over VAT on private school fees in the Finance Bill.