The Scottish Beer & Pub Association (SBPA) and Scottish Licensed Trade Association (SLTA) have stated the country’s pubs, bars and breweries are a vital part of the nation’s economy, culture and social wellbeing in their joint Scottish Draft Budget Submission 2026-27 to the Scottish government.
The SBPA and SLTA stated: “The sector supports around 65,000 jobs, pays £1.2bn in wages and contributes £2.3bn in gross value added (GVA) to the economy, underpinning thousands of local businesses and supply chains.
Benefits demonstrated
“This powerful level of economic activity translates to a GVA multiplier of 2.0. Put simply, for every £1 of direct GVA in the sector, an additional £1 is created elsewhere in the economy. The strength of this multiplier demonstrates the benefits of the beer, pub and bar sector to the Scottish and regional economies.”
SBPA senior adviser Paul Togneri and SLTA managing director Colin Wilkinson added Scotland’s pubs and bars are a major attraction for visitors that strengthens the country’s tourism industry.
“Beyond their economic impact, pubs and bars serve as essential community hubs, providing welcoming spaces that help tackle loneliness and social isolation,” they said. “By fostering social connection and cultural identity, Scotland’s pubs and bars play an irreplaceable role in both economic resilience and community wellbeing.”
Net income falls 54%
However, they warn the sustainability of this contribution – and many businesses across the country – are at risk, stating: “Since 2019, we have seen an 86% increase in utility costs and a 58% increase in wages and salaries. This has resulted in a 54% decrease in net income.”
- Table of increased costs in hospitality businesses across Scotland:
| 2019 | 2023 | 2024 | 2025 | 2019 vs 2025 | % change | YoY change | ||
|---|---|---|---|---|---|---|---|---|
| Turnover (excl. VAT) | £520,000 | £629,200 | £679,536 | £710,502 | +£190,502 | 37% | 4.6% | |
| Cost of Sales | £223,600 | £267,202 | £293,922 | £302,446 | +£78,846 | 35% | 2.9% | |
| Gross Margin | £296,400 | £361,998 | £385,614 | £408,056 | +£111,656 | 38% | 5.8% | |
| Wages and Salaries | £119,600 | £155,480 | £171,028 | £189,545 | +£69,945 | 58% | 10.8% | |
| Rates | £18,148 | £18,148 | £19,364 | £19,538 | +£1,390 | 8% | 0.9% | |
| Utilities (inc. water and waste) | £20,800 | £45,760 | £41,184 | £38,713 | +£17,913 | 86% | -6.0% | |
| Other Costs | £93,600 | £121,680 | £133,848 | £139,792 | +£46,192 | 49% | 4.4% | |
| Total Operating Costs | £252,148 | £341,068 | £365,424 | £387,588 | +£135,440 | 54% | 6.1% | |
| Net Income (excl. machine income) | £44,252 | £20,930 | £20,190 | £20,468 | -£23,784 | -54% | 1.4% | |
| Net margin | 8.5% | 3.3% | 3.0% | 2.9% |
Source: Frontier Economics, BBPA analysis
Alongside business rates relief, the bodies have asked for the provision of 100% transitional relief for the licensed hospitality sector to protect against the unprecedented increases in the revaluation; a £10m green fund for hospitality and brewers to help decarbonise and contribute towards net zero; continued funding for Best Bar None Scotland to support its work in promoting best practice; and protection of VisitScotland’s budget to support continued tourist activity.
