Labour faces tearing up its crippling business rates rise for the whole hospitality sector after proposing a carve out to save struggling pubs.

Hotels, shops and other small businesses piled pressure on Chancellor Rachel Reeves to find a solution for them following the U-turn on pubs.

Mutinous Labour MPs, flying the flag for pubs in their constituencies, were told this week that Ms Reeves will announce a package of emergency help ‘within days’ in a bid to head off a brewing revolt.

But a string of other hospitality sectors are now pressuring the Government to extend support to all areas of hospitality.

One hotel magnate revealed he faces a £12.4million increase to his rates bill for a single establishment.

Chris Webb, Labour MP for Blackpool South, whose coastal constituency has been hit hard by increases to business rates, said Treasury minister Dan Tomlinson was ‘responsive’ to reducing business rates for hospitality more broadly in a private meeting on Thursday night.

‘My conversations last night were, “the whole sector has to be included,” and what I got back was they are looking at all aspects of hospitality,’ he said last night.

He added: ‘Nothing is off the table, and they’re continuing to engage and listen to the sector whilst they’re looking at any possible changes.’

Pubs were offered temporary relief from paying full business rates during Covid, but the Chancellor’s decision to scrap the discount in the Budget left many landlords contemplating closure.

Amid a furious backlash, and to see off a potential Commons rebellion on Monday, the Treasury signalled a climbdown, but is still said to be working out quite what.

A number of pubs launched a nationwide campaign to bar entry to Labour MPs in protest at the Government's hikes to business rates

Hotels, restaurants and small businesses in coastal towns like Blackpool have been particularly effected by hikes to business rates

Live music venues are living 'hand to mouth as it is', says one Labour MP

Hotels have been particularly affected by business rates, which will see all commercial properties due to pay higher bills from April.

Where pubs face a 76 increase in 2028 from the current average business rate paid, hotels face a 115 per cent increase by that time.

Surinder Arora, who operates a number of hotels in the UK, told BBC Radio 4's Today programme that the business rates bill for just one of his hotels increased by £12.4millon after discounts were scaled back.

The chief executive of the Arora Group labelled a potential carve-out for pubs only as ‘not right or fair’.

‘The new numbers are eye-watering,’ Mr Arora told the BBC, warning that ‘belt-tightening’ was inevitable, and that higher costs would be passed on to customers.