Countryside branches face steep tax rises after April revaluation pushed many above exemption thresholds
Rural Post Offices across Britain are warning they could be forced to close after a sharp rise in business rates left branches facing an additional £29million tax burden over the next year.
The increases have fallen particularly heavily on countryside outlets, with the average rural branch expected to pay four times more than in 2023-24, while some businesses are facing rises of 200 per cent.
An April revaluation, the first since the pandemic, pushed around 600 previously exempt branches above the threshold for business rates liability for the first time.
Small and rural Post Offices are expected to shoulder the largest increases, raising concerns over the future of services in communities with limited access to banks and retail facilities.
The impact of the rising costs has been highlighted by postmasters, including Paul Patel, who operates Dibden Purlieu Post Office in Hampshire.
Mr Patel said his business rates bill had risen by more than £2,000 alongside increased National Insurance contributions and higher staffing costs linked to minimum wage rises.
He said: "These rising costs come on top of increased tax and National Insurance contributions linked to the higher minimum wage.
"Altogether, it means my outgoings are rising by thousands of pounds a year. Postmasters are constantly told how vital we are to our communities, particularly in rural areas like mine.
"But if we are to continue providing these essential services, we need meaningful support."
Research commissioned by the state-owned Post Office found that one quarter of branches now face annual business rates bills of more than £5,000.
The figures also showed one in 10 branches will pay more than £10,000.
Post Office chief executive Neil Brocklehurst said the current tax system placed an unfair burden on branches compared with other retailers.
Mr Brocklehurst said: "Post Offices are a lifeline for many communities.
"There is a structural unfairness in how the tax burden falls across the Post Office network.
"In reality, most Post Offices are small businesses run independently by postmasters, yet are being taxed as if they were large retailers."
The Post Office said branches now pay around 10 per cent of their gross value added in business rates compared with less than five per cent across the wider retail sector.
The Treasury defended the Government's approach and pointed to wider support measures for businesses.
A Treasury spokesman said: "We have the right economic plan — we're backing high street businesses by reforming business rates, including a £4.3billion support package to limit bill rises, capping corporation tax at 25 per cent, cutting red tape and taking action on the cost of living to keep footfall strong."
It comes amid warnings of wider pressures facing the high street.
The British Heart Foundation announced last week it would close 150 charity shops, while Cancer Research shut 90 outlets last year.
The Post Office is also continuing efforts to rebuild trust following the Horizon scandal, which resulted in hundreds of sub-postmasters being wrongly accused of theft because of faulty IT systems.
Its recovery strategy includes plans to increase postmaster pay by £250million before the end of the decade and sell more than 100 Crown branches.