NURSERIES called on ministers yesterday to exempt them from business rate rises while they deal with government demands to double the number of free childcare hours.

The National Day Nurseries Association (NDNA) warned that nurseries and play schools are facing a 26 per cent tax hike after a government review of business rates.

The charity is calling on the government to bring the rules for nurseries in England and Wales into line with Scotland, where they do not pay the tax.

Such a move would save nurseries and play schools across Britain more than half a billion pounds over the next five years — which would otherwise be passed onto fee-paying parents or force nurseries to close, the NDNA warned.

Starting this Friday, nurseries are set to shoulder the added financial burden of delivering 30 hours’ free childcare for three to four-year-old children under a new government policy, up from 15.

NDNA chief executive Purnima Tanuku said: “Our argument is that nurseries offer a social and economic good in providing good-quality early years education and allowing parents to work.

“Increasing business costs, including National Minimum Wage rises, mean many nurseries are struggling to stay in business and fees are rising for parents whose children don’t qualify for free hours.”

The charity’s annual survey revealed that 51 per cent of nurseries in England said removing business rates would help them deliver the 30 hours and they would not have to increase rates.

Ms Tanuku added: “In Wales, the cost of business rates was listed as the third biggest challenge facing nurseries — along with achieving profit or surplus and cost of utilities.”

For the next five years business rates will be determined by property valuations made in April 2015.