The business rates revaluation that took place ahead of the Government’s November 2025 Budget revealed that recording studios, music venues and pubs were set to face significant business rate increases, with many facing potential closure as a result. 

However, after a campaign from the music and hospitality sector, the Government rowed back on its position.  As of April 2026 music venues and pubs were to receive 15% off their new business rates bill and bills frozen for a further two years. A review into the methods used to calculate their rates was also promised. 

But recording studios were not included in the U-turn. For many, the proposed business rate hikes pose an existential threat not only to their future, but to the £8 billion contribution the music industry makes to the economy. 

What’s the issue? 

The UK’s recording studio sector, which includes iconic venues Abbey Road, AIR, Real World, and Rockfield Studios, is facing a perfect storm of issues representing an existential threat.  

The Government’s 2025 Budget decision leaves the average recording studio with a rateable value increase of 45%, with extremes of nearly 400%. Thin margins and a fragile client base means costs cannot be passed on like other businesses.  

But this is just the tip of the iceberg. Business rates are not just calculated by the rateable value, they require a Government set multiplier to determine the final bill. While the Government introduced lower business rates multipliers for the Retail, Hospitality and Leisure (RHL) sectors as a form of relief, these regulations specifically exclude “premises used for the production or recording of music audio or film for business or professional use”. Yet film and TV studios already receive separate, targeted business rates relief, recording studios do not.  

Following recent meetings between the MPG and treasury minister, Lord Liversall, the government has adapted the guidance on RHL categorisation to allow studios not who mainly exist for non-professional use could qualify for the RHL category, however we continue to push for more clarity in the guidance.  

Plus, a lack of clear categorisation from the Valuation Office Agency (VOA) means studios are often misclassified as office space, as they have no category in the guidance. Under office rules (Gross Internal Area), the VOA taxes the square footage of internal walls. In studios, 3-foot-thick soundproofing and “room-within-a-room” voids can occupy 30% of the floorplan. Owners are effectively taxed on “dead space” required for their craft. Consequently, they end up paying higher rates. And unlike office-based business they cannot just move to a smaller, cheaper space without destroying millions in fixed acoustic investment. 

According to a Music Producers Guild survey in 2024, 50% of studios asked are considering closing in the next year. An estimated 250 studios are at risk of closure without mitigations.  

What can be done to change it? 

• The Government should pause the implementation of the new rateable values on recording studios. Studios must be included as part of the review into how rateable values are calculated so that these more accurately reflect how they operate. 

• The Government must include all recording studios in the RHL Business Rates Multiplier. 

• The Government should instruct the VOA to categorise recording studios properly and have appropriate guidance that allows them to be properly valued based on their characteristics. 

• The Government should commission an economic impact asessment of the value of recording studios to the wider economy. Recording studios are the foundation of the £8 billion music industry, generating millions in session fees  for our world-renowned session musicians, engineers and producers, as well as supporting local high street economies.  

• The Government should explore introducing targeted rates relief for recording studios similar to that introduced for film studios, which provides 40% off the gross business rates payable for qualifying spaces. 

What’s happening to change it? 

The  UK Music and Music Producers’ Guild (MPG) handed in a petition to Downing Street in December 2025 calling for government to take urgent action and reverse its plans for business rate increases for studios. The letter was signed by a raft of legendary artists and producers, including the likes of Peter Gabriel, Pete Townshend, Robert Smith, producer Catherine Marks (Wolf Alice), and producer Paul Epworth (Adele). 

Politicians have also thrown their weight behind the campaign. There was a dedicated debate on the issue in the house of Lords lead by Lord Clement-Jones, which led to a meeting between the treasury minister, Lord Liversall, the MPG and the VOA. Lord Brennan of Canton raised the issue in the House of Lords, and Labour MP Anneliese Midgley has sent an open letter signed by over 50 other Labour MPs to Chancellor Rachel Reeves urging her to offer recording studios the same protections offered to venues and pubs. 

Further Information 

• There are around 500 recording studios in the UK underpinning the UK’s £8 billion music industry.  

• Large studios like AIR and Abbey Road are part of the UK’s film scoring subsector which is worth c£170 million to the economy, and directly supporting over 1000 jobs from musicians, music supervisors, engineers to agents and admin staff. UK scoring studios are world-leading, with 4 out of the top 10 biggest grossing movies of 2024 having their scores recorded in the UK. 

• Small grassroots recording and rehearsal studios are vital for nurturing the next generation of artists and providing the affordable infrastructure necessary for emerging talent to develop. 

• Studios are public-facing cultural infrastructure, attracting footfall to and supporting local businesses. Many offer onsite catering and host live music performances and youth-focused activities.