Industry fights back on business rates
The figure was revealed as part of the British Beer & Pub Association’s (BBPA) response to the Government’s review of business rates and shows that pubs and bars pay 2.8% of the UK’s total business rates bill, but account for just 0.5% of business turnover.
BBPA chief executive Brigid Simmonds said: “Many high-street businesses are being damaged by unfairness in our rating system, but it is a particular problem for pubs. We need a system that is both fairer overall, and much more responsive to the needs of businesses like pubs.”
The BBPA is pushing for greater tax reliefs for pubs, a move to alternative rating systems, and more flexibility to appeal rateable values (RV) alongside improvements to the appeals system.
A survey of Publican’s Morning Advertiser (PMA) readers, as part of our Better Rates for Pubs campaign, found that more than half described the payments as having a ‘major impact’ on pub profitability. Just 7% of respondents felt their pub’s current RV was ‘fair’.
All Party Parliamentary Save the Pub Group chair and Liberal Democrat MP Greg Mulholland said that business rates were a huge issue for licensees.
“The Parliamentary Save the Pub group has highlighted business rates as one of the biggest problems for pubs, and we will be campaigning hard for change. We need a change in how pub rates are calculated that doesn’t penalise traditional pubs and is based on realistic assessments of trade.”
Mulholland said the Save the Pub Group would organise a meeting in parliament to discuss the issue with MPs, the BBPA and licensee organisations.
The Campaign for Real Ale (CAMRA) added: “Business rates place a huge burden on community pubs and this needs to be addressed. Taking business rates, beer duty, VAT and other taxes together means that over 40% of the cost of a pub pint goes in tax.
“We need to make sure the ongoing review of business rates in England leads to outcomes that benefit pubs, which contribute so much to the national economy.
“Options include making the temporary £1,500 retail relief permanent and providing more generous rate relief for small businesses.”
ALMR chief executive Kate Nicholls said: "The ALMR has repeatedly called for a root and branch reform of a system that sees pubs pay around 15 pence per pint in rates compared to 1 penny per pint in supermarkets and is not responsive enough to provide up-to-date information.
“We need to ensure that this is a genuine tax on business, not just a property tax and there needs to be a far greater degree of consistency and fairness when it comes to calculating valuations which underpin the method for calculating rates. “
The PMA spoke to several licensees who said the current system stifles expansion and prevents pubs from taking on much-needed extra staff.
Martin Barnes, who runs Robinsons brewery’s the George & Dragon, in Holmes Chapel, Cheshire, said: “The growth the industry would see through a fairer system would be massive. We’re a young company and we would have been able to reach our goals sooner had there been more cash available. Many people in the industry are overworked and underpaid. More money in the pot would enable operators to pay their staff more, which would, in turn, encourage more people to see working in pubs as a valid career choice.”
Licensees also pointed to the apparent disparity between what pubs pay when compared with other local businesses. Enterprise tenant Paul French, who runs Broadways, in Didcot, Oxfordshire, said: “I pay four times more than a local council hall does, but they have a higher turnover and employ more staff than I do.”
