Prominent voices in the licensed premises sector yesterday rallied around calls for the government to reduce the tax burden on British pubs, warning that pubs are at risk of closure without action.
Shepherd Neame chief executive Jonathan Neame told City A.M. yesterday that "the tax burden is too high" on pubs, due to the combination of excise duty, business rates and VAT.
His comments came after JD Wetherspoon protested at high taxes by selling food and drink 7.5 per cent cheaper than usual across its 900 pubs yesterday.
Chairman Tim Martin said reducing the VAT rate for pubs, which currently stands at 20 per cent, "is a win-win situation for the government and our industry.”
"Creating tax equality among pubs, restaurants and supermarkets will fulfil many government objectives. It will create more jobs and raise the amount of taxes which the government receives, since pubs and restaurants pay more taxes and create more jobs than supermarkets do."
The Campaign for Real Ale added its voice to the campaign yesterday, with chief executive Tim Page commenting: "Taxes now make up more than a third of a cost of a pint. This is frankly unsustainable, and it is the consumer that will ultimately pay the price - whether it's when their beloved local closes down or when the cost of their pint goes up."
In a separate report from CGA released today, it emerged that the total number of restaurants, bars and pubs in the UK declined 0.3 per cent in the year to June, with drinks-led pubs accounting for many of the closures.
Kate Nicholls, chief executive of the Association of Licensed Multiple Retailers (ALMR) also backed the initiative, telling City A.M. that "a cut in VAT is the single most effective tool in staunching a consumer spending downturn in the face of rising inflation.”
British Beer and Pub Association (BBPA) chief Brigid Simmonds added: "Even a small drop in the VAT rate for eating out, to 15 per cent, would create 78,000 jobs, and would be a big boost for the economy.