While there were signs of optimism at the end of last year, the burden of alcohol duty increases, high energy costs, business rates and NIC hikes will make survival impossible without support, the Night-Time Industries Association (NTIA) said.
Ahead of the Spring Forecast on Wednesday 26 March, the association called on Chancellor Rachel Reeves to reinstate VAT relief, tier business rates, and adjust National Insurance thresholds to bolster cash strapped firms.
NTIA CEO Michael Kill said: “The rhetoric from the Chancellor may focus on cost-saving measures, but this is meaningless for businesses already buckling under the strain of rising costs and taxation, who have already cost-saved to extremes.
Glimmer of recovery
“While the ‘golden quarter’ offered a glimmer of recovery, it has not been enough to safeguard the future. Feedback from across the sector is clear: recovery will be short-lived. Without immediate intervention, the impending financial pressures will push many businesses over the edge.”
In addition, uncertainty over the content of the fiscal address, coupled with the legacy of last autumn’s disappointing budget, has left many fearing the worst, the NTIA said.
A post autumn-budget survey of more than 500 businesses, conducted by the NTIA, showed 90% of respondents have been forced to cut staff numbers and hours, operating hours and essential investments.
Meanwhile 40% warned they would be forced to close within six months unless urgent support was provided, with 32.7% of the nation’s nightclubs already lost from March 2020 to November 2024.
Moreover, the organisation stated taxes on nightlife venues were among the “highest in Europe”.
Economic and societal contribution
It added the UK’s nightlife and hospitality sector was “central” to the nation’s “economic and cultural fabric”, employing hundreds of thousands and driving local economies.
Kill continued: “This industry has proven its resilience time and again, but we need a Government that recognises the economic and societal contribution we make.
“The time for half measures is over. Without VAT relief, tiered business rates, and meaningful support for rising costs, April will mark the end for many businesses.
“We need action now, not later, and we can’t keep posturing around long-term reform as many won’t be here to benefit from it.”
