Eurotunnel, the operator of the Channel Tunnel, has announced a suspension of its UK projects, citing a significant increase in business rates as a key reason. The company reported that it has been notified of a nearly 200% increase in its business rates starting next year, which they describe as creating an “unsustainable” tax environment for future investments.
According to Eurotunnel, this escalation in costs runs counter to governmental objectives of fostering economic growth and increasing investment. In response, the Treasury indicated its commitment to supporting businesses most affected by tax increases and expressed willingness to engage in discussions with relevant industries about their concerns.
The increase in business rates for Eurotunnel arises from a new valuation assessment conducted by the Valuation Office Agency (VOA), which provides property valuations that inform tax policy. Eurotunnel has indicated that these changes would elevate its overall tax burden to around 75% of its UK earnings.
The VOA clarified that it does not set business rates and mentioned that the projected 2024 liability has not been finalized. The agency also confirmed ongoing engagement with Eurotunnel to discuss the valuation concerns.
As the Autumn Budget approaches, Eurotunnel has called for clarity regarding business rates, linking its decision to freeze future railway investments in the UK to these tax policy uncertainties. This includes reports of the company retracting plans to reopen a freight terminal and implement new freight services.
The Channel Tunnel, which links southern England and northern France through an undersea route, is vital for both freight and passenger transport. Eurostar, a separate entity and key user of the tunnel, operates passenger services across multiple European destinations. The government is expected to reveal finalized business rates and tax details as part of the upcoming budget, with the changes slated to take effect in April 2026. The Treasury has refrained from commenting on potential future tax policy changes until all valuation factors are clearly understood.
Source: https://www.bbc.com/news/articles/cx2n215nqvyo?at_medium=RSS&at_campaign=rss