Pub Closures Set To Rise Ten-Fold Without Rate Relief Pub Boss Warns

The hospitality sector will see closure rates increase tenfold without business rates relief, the boss of Fuller’s has warned, as businesses brace for an increase in their tax bill.

Simon Emeny, chief executive of Fuller’s, warned high numbers of pub closures in 2023 would only accelerate without a drastic intervention from the Government.

He said: “The number of pub closures and restaurant closures that have happened so far this year will be multiplied tenfold, if the Government doesn’t extend the business rates relief for small businesses.”

Mr Emeny said: “Until the Government finds a more equitable way of raising taxes through business rates, you will continue to see pubs closing.

“The tax burden on pubs is huge. We, as a region, account for 0.5 per cent of UK revenues, but we pay 2.5 per cent of UK business rates, so we are disproportionately paying our way.

Earlier this month data from real estate analysts Altus Group revealed that almost as many pubs shut across the UK in the first six months of 2023 than did across the entirety of last year.

The study also revealed that London is the hardest hit, with more pubs closing in London in the first six months of this year than anywhere else in England.

The capital lost 46 watering holes up to the end of June, and across the UK as a whole, 383 pubs closed in the same period, almost matching the total for the whole of 2022 when 386 were lost.

In total, business rates bills will rise by a total of £1.74 billion next April, to around £27.74 billion, giving unsustainable rises to all sectors of the economy, according to John Webber, Head of Business Rates at Colliers, unless the Government steps in and intervenes. “All sectors are suffering from increased costs, whether from increased wage bills, materials or energy costs. They cannot cope with the hike in rates bills too. Higher occupation costs will only dampen expansion and growth plans and for many businesses might be the last straw. The government must do something,” he said.

Mr Emeny said Fuller’s pubs have not been as badly hit during the cost of living crisis because its pubs attract a more affluent clientele. “We have deliberately built a business in more affluent parts of the UK.”

Although it has raised prices due to inflation, he said it has tried to keep them “as low as possible”.
Despite rising inflation, he said that when people go to Fuller’s pubs they are drinking more expensive lagers and ales.

“Our customers are thinking that if I come out, I’m going to enjoy a really good quality drink. “We are seeing the fastest growth in our most premium products.”
He said Fuller would not stock beer made by brewers who have recently weakened their power to save taxes.

Mr Emeni said: “A customer falls in love with a particular brand because of its taste and the way it is made. And if you do start tinkering with wine, you do so at your own peril and risk. I’m not a fan of it at all.”