Explanatory note

In relation to Wales, the non-domestic rating multiplier for each chargeable financial year is calculated in accordance with Part A2 of Schedule 7 to the Local Government Finance Act 1988 (“the 1988 Act”).

These Regulations amend the Non-Domestic Rating (Description of Differential Multipliers) (Wales) Regulations 2025 (“the 2025 Regulations”) by substituting a new regulation 3(2)(b). The effect of this amendment is to extend the application of the retail multiplier (renamed by these Regulations as the “lower multiplier”) so that, in addition to retail and retail-related hereditaments, it also applies to specified food and drink hospitality, visitor accommodation and leisure hereditaments, as identified by their descriptions in the local non-domestic rating list. This multiplier will continue to apply only where the hereditament has a relevant description and a rateable value below £51,000.

These Regulations also amend the Non-Domestic Rating (Value of Differential Multipliers) (Wales) Regulations 2026 (“the 2026 Regulations”) by substituting “1.042” for the value of N in the formula set out in paragraph A16(1) of Schedule 7 to the 1988 Act for the purposes of calculating the higher multiplier. This has the effect of increasing the higher multiplier for hereditaments to which regulations 4 and 5 of the 2025 Regulations apply, from 2.6% to 4.2% above the non-domestic rating multiplier for the relevant financial year.

These Regulations also substitute references to the “retail” multiplier in the 2025 Regulations and the 2026 Regulations with references to the “lower” multiplier, reflecting the extension of this multiplier to a broader range of hereditaments rather than only to retail-related hereditaments. The reference to the “retail” multiplier in Schedule 2 to the Non-Domestic Rating (Demand Notices) (Wales) Regulations 2017 (which prescribes the information which must be included in the explanatory notes that accompany a demand notice) is amended accordingly to refer to the “lower” multiplier.

The Welsh Ministers’ Code of Practice on the carrying out of Regulatory Impact Assessments was considered in relation to these Regulations. As a result, a regulatory impact assessment has been prepared as to the likely costs and benefits of complying with these Regulations. A copy can be obtained from the Non-Domestic Rates Policy and Reform Division, Welsh Government, Cathays Park, Cardiff, CF10 3NQ.