x
Photo: Flickr Creative Commons
A Parliamentary debate today will examine taxation of the beer and pub sector in the UK ahead of what many in the industry view as a crucial Budget on November 22.
The debate will highlight the pressures that the pub and brewing industries face to survive in an environment of rising beer duty and business rate increases.
Campaigners have warned that pubs could face closure thanks to a ‘triple whammy’ of taxation, rate increases and an end to rate relief, unless politicians support the British pub industry.
Licensees say they are struggling following the 2p a pint increase on beer duty in March’s Budget and are facing a further 2p a pint increase in November’s Budget. They say the Chancellor, Philip Hammond, needs to listen to calls to freeze or reduce beer duty in this Budget to help support the beer and pub industry, which employs around 900,000 people and contributes more than £23bn to the economy.
Meanwhile, a change in the business rates system this year saw four in ten licensees facing rates hikes. The temporary £1,000 a pub rate relief offered by the Treasury comes to an end in March, leaving pubs to absorb the full force of the increases, with many licensees saying they may be forced out of business.
The final part of the triple whammy for pubs will see the upper limit on annual business rate rises for community pubs increased from 12.5% to 17.5%, which again could make the difference between survival and closure for many local pubs. The Campaign for Real Ale (CAMRA) is calling for a £5,000 a pub business rate discount to be introduced.
The CAMRA view
Colin Valentine, CAMRA’s national chairman, said: “The debate today is crucial to highlight the issues the pub sector faces, and MPs have to realise they need to call on the Chancellor to start showing more support for this vital British industry.
“The beer and pub sector is already overburdened by tax, specifically business rates and beer duty, with tax making up a third of the price of a pint in a pub. Customers now find the price of beer less affordable, which means decreased sales and the likelihood of more boarded-up pubs.
“Pubs deliver benefits to individuals, providing responsible and social environments to enjoy a drink. They benefit local economies with local employment, and they provide a large amount of revenue for the Treasury. Failure to support pubs will see all these benefits reduced. We’ll see more people drinking at home, less local employment and reduced Government revenue.
“Time and time again, independent research has shown how vital the pub and brewing sector is to the country as a whole. It’s time MPs listen to beer drinkers and pub-goers in their constituency, and demand the Chancellor takes notice.”
CAMRA has urged its 190,000 members across the country to email and write to their MPs encouraging them to take part in the debate today and speak on behalf of pubs and breweries in their constituencies. More information can be found at: https://www.camra.org.uk/
The licensees’ view
Carl Ernsting, who runs the Star Inn in Halesworth, Suffolk, said: “We experienced a business rate increase of almost £10,000 and that, combined with other increases, will mean that our village pub, that has traded since 1841, will no longer be a viable business.”
Martin Wood, licensee at the Hope Inn, Stockport, said: “Since the rate increases and beer duty escalator we have had no choice but to put our prices up.
“Along with that and the fact we have to pay more VAT than supermarkets, there has been a significant drop in trade, to the point we now struggle week on week, wondering if we can pay our way going forward.”
