The spring statement on Tuesday 13 March may not be a full blown Budget, because that has been moved to the autumn, but economic policy that cannot wait until later in the year could still be unveiled by Philip Hammond.
With this in mind, the group, including UKHospitality, the British Beer & Pub Association (BBPA), Campaign for Real Ale (CAMRA) and the Society of Independent Brewers (SIBA) have written a joint letter to Hammond to highlight major challenges the sector faces.
The letter calls for a comprehensive review of business rates, a consultation on a possible reduced rate of VAT for hospitality and that the Chancellor engages with the sector to overhaul the excise duty system to promote the consumption of lower-strength drinks in licensed premises.
Business cost pressures
UKHospitality chief executive Kate Nicholls said: “With cost pressures continuing to squeeze many businesses and with the UK’s withdrawal from the EU fast approaching, the time is right for the Government to provide decisive support for hospitality businesses.
“The Government has indicated that it will provide the support we want, and that it will undertake a review on business rates, but pubs and restaurants are still overpaying £1bn in year in rates. We want to see the Government push ahead with its promised review and begin to fashion a regulatory system that supports hospitality businesses and supports growth.”
VAT and duty ahead of Brexit
Nicholls also called on the Government to address sector concerns around VAT and duty as Brexit draws closer.
Brigid Simmonds, BBPA chief executive, said: “I hope the Government will consider this united call for a review of actions to help our sector. The business rates burden on pubs is particularly acute, paying 2.8% of all business rates while accounting for less than 1% of rateable turnover.
“British beer is also over-taxed, and while the duty freeze in the Autumn Budget was welcome, there is still work to be done to protect a great British manufacturing industry. Of every £1 spent in a pub, 34p goes to the taxman.”
Fair deal for pubs
CAMRA national chairman Colin Valentine urged the Government to look at how taxation on beer and pubs can be changed to benefit both publicans and beer drinkers as the country prepares to leave the EU.
He said: “Pubs need a fair deal on tax to ensure that they remain competitive with off-trade outlets like supermarkets, which are better placed to absorb the high cost of taxation. We need to act now to help keep the lid on price increases so that more people can afford to visit their local and enjoy all of the personal, social and community-wide benefits of pub-going."
And Mike Benner, SIBA chief executive, said: “Nearly every MP has at least one independent craft brewer in their patch creating jobs, investment and above all, great beer. Brewers rely on pubs, restaurants and the hospitality sector for a significant part of their business. That’s why we need the promised business rates reform from the Conservative manifesto, action on hospitality VAT and long-term thinking about what the duty system might look like post-Brexit.”