Is NSW making it easier to run a hospitality business?
12 Nov 2026 | Leah Tucker, Senior Policy Manager, Energy and Infrastructure
The reforms, the gaps and what comes next
Hospitality businesses across NSW are facing pressure from all directions. Energy, wages and insurance costs are rising, while planning, licensing and compliance requirements continue to take time and money away from running a business.
Reducing these pressures is a priority for Business NSW and our members. We have been working with government on the night-time economy and pushing for practical reforms that make it easier for hospitality, retail, tourism and entertainment businesses to operate, grow and attract customers.
Our work has included regular engagement with the Office of the 24-Hour Economy Commissioner, advocating for regional businesses to benefit from the 24-hour economy strategy, and pushing for fewer regulatory barriers and greater flexibility around trading hours, planning and development approvals.
Some changes are already happening. Others still have a way to go.
Cutting red tape for cafés and restaurants
The NSW Government is reviewing unnecessary regulatory burdens affecting the state's more than 50,000 food retail operators.
The review is looking at licensing, permits, reporting and inspections, and where duplication and delays across government can be removed. The real test for businesses will be whether this delivers faster approvals, clearer requirements and lower compliance costs.
Business NSW has consistently called for action on unnecessary regulation. Our Business Conditions Survey found that 41% of businesses identified regulatory burdens as an obstacle to improving productivity.
In March 2026, Business NSW welcomed the Government's hospitality red-tape review and called for simpler development applications, more consistent council requirements and a permanent mechanism for businesses to report unnecessary regulation.
The review's recommendations were due in August 2026 but have not yet been publicly released.
Making it easier for venues to operate and grow
The NSW Government's Vibrancy Reforms are particularly relevant to hospitality businesses and the night-time economy.
Changes include:
- Easier outdoor dining: Eligible venues can offer outdoor dining without a development application, although council permits may still apply.
- Increased patron capacity: Eligible venues can expand outdoor dining capacity without modifying development consent, subject to limits.
- More flexible trading hours: Licensed venues can apply for Sunday trading until midnight and extended hours during special events.
- Support for live entertainment: Eligible venues can access an 80% licence fee discount and two additional trading hours, with fewer entertainment restrictions.
- Takeaway alcohol: Eligible venues can apply to sell limited alcohol with takeaway meals.
- Simpler liquor licensing: Changes introduced in September 2026 streamline applications to remove or amend restrictive licence conditions.
Further planning reforms are also being considered for Special Entertainment Precincts, including simpler approvals for temporary events, rooftop dining and converting some commercial premises into entertainment venues.
Business NSW supports the direction of these reforms, but we want to see the benefits extend across NSW, including regional communities. Our advocacy has specifically called for a framework that gives regional businesses the opportunity to benefit from the night-time economy, alongside more flexible planning and zoning and faster development approvals.
That work is already translating into opportunities outside Sydney. Business NSW has helped promote the Regional Night-Time Economy Program through our networks, with regional business collectives among those receiving support to develop local night-time economies.
A successful 24-hour economy depends on more than extended trading hours. Businesses also need efficient approvals, accessible transport and operating conditions that make it commercially viable to trade later and invest in new opportunities.
New regulatory requirements could increase business costs
At the same time, hospitality businesses are being asked to meet new environmental requirements.
Mandatory food waste separation commenced in July 2026 for larger businesses with at least 3,960 litres of weekly general waste bin capacity. The requirements are due to extend to smaller operators in July 2028 and July 2030, subject to thresholds and exemptions.
NSW's Plastics Plan 2.0 also introduces changes to takeaway packaging. From 2028, food service businesses will be required to accept customers' clean reusable cups, subject to hygiene safeguards, alongside planned recyclable packaging requirements.
These reforms aim to reduce waste and improve environmental outcomes. However, hospitality businesses may face higher costs for separate waste collection, additional bins, storage facilities, alternative packaging and staff training. Smaller cafés, restaurants and takeaway operators may face particular challenges where storage space is limited or additional collection services are expensive.
Making reform work for our members
Our position is simple: making it easier to do business in one area shouldn't be cancelled out by adding cost and complexity somewhere else.
We will continue pushing for clear and consistent requirements, faster approvals and practical support for businesses adapting to new obligations, particularly smaller operators and those in regional NSW.
Ultimately, reform should be judged by what it means for businesses on the ground: Does it save you time? Does it reduce costs? Does it make it easier to operate, grow and bring in more customers?
We want to hear from members
Your experiences help shape our advocacy. If a regulation, approval process or new requirement is creating unnecessary cost or getting in the way of your business, we want to hear about it by sharing your experience in the form below.
We want to hear from you
Your experiences help shape our advocacy. If a regulation, approval process or new requirement is creating unnecessary cost or getting in the way of your business, we want to hear about it.