BII: Fair Tax Deal For Pubs Will Unlock Investment And Jobs In Every Community, Without It Thousands Could Close
The latest British Institute of Innkeeping (BII) Member Survey shows that 75% of publicans stand ready to invest if taxes are reduced – but 2 in 5 expect to close if the tax burden rises yet again.
The Government has a huge opportunity at the Budget to unlock investment, skilled jobs and growth in communities across the UK – or risk the unnecessary closure of thousands of pubs.
The latest BII Member Survey shows that despite strong summer trading, supported by great weather and major events, only 1 in 3 pubs made a profit, with 54% reporting lower profits. The full year January to August shows an even worse position with only 1 in 4 making a profit.
The biggest pressures are staff costs, energy and the inability to pass further cost increases on to customers already facing stretched household budgets.
Around 40p from every £1 spent in a pub goes to the Treasury through taxation. The BII says this burden is unfair, unsustainable and is significantly limiting the potential of pubs to invest, employ more people and support their local economies.
BII Member Survey shows what a fairer tax deal, with a priority on 10% VAT on all pub sales, could unlock:
• 75% would invest in their pubs
• 62% would increase staff hours, supporting additional skilled jobs
• 1 in 2 would spend more with local suppliers
Without change, the consequences are equally clear. If the cumulative tax burden remains the same, then 1 in 5 pubs expect to close and if taxes increase yet again this would lead to 2 in every 5 pubs expecting to close.
Steve Alton, BII CEO, said:
“Our latest member survey sends Government a very clear message. Pubs have enormous potential to deliver exactly what our economy needs – investment, employment and growth in every community. A fair tax deal, including 10% VAT on all pub sales, is vital to make this happen.
“But when around 40p from every £1 spent in a pub goes to the Treasury, the tax burden is unfair and unsustainable. It is choking the potential of good long-standing pub businesses to invest and grow.
“Maintaining or increasing the current unfair cumulative tax burden again could mean thousands of pubs lost from communities across the UK.
“Back our pubs and they will deliver in every postcode. Tax them harder and we will lose thousands.”