Earlier this month, Reform leader Nigel Farage set out proposals to cut hospitality VAT to 10%, reduce beer duty by 10% and phase out business rates for pubs, arguing the measures could take up to £1 off the price of a pint over time.
JD Wetherspoon chairman Tim Martin called on the wider hospitality industry to support what he described as “tax parity with supermarkets”.
“A few days ago, the leader of the political party, which is leading in the latest polls, offered the hospitality industry something many had assumed impossible, in effect, tax parity with supermarkets,” he said.
“There’s no question that this initiative would utterly transform the competitiveness of pubs, which have lost 50% of their beer trade to supermarkets since the millennium, according to analysts at bankers Morgan Stanley.”
Martin said reducing VAT to 10%, alongside further cuts to excise duty and business rates, would restore margins and allow operators to lower prices.
“Most pubs could probably, for example, offer one beer, one lager and one cider for, say £2.99, with these tax reductions, and still have a higher gross margin than today,” he said.
“By eliminating the tax differential between supermarkets and the hospitality industry, and restoring margins to devastated businesses, these changes would enable pubs to regain some, or all, of their lost trade.”
Across the sector
Other operators have focused on long standing calls for tax reform.
Lawson Mountstevens, managing director of Star Pubs, said the business was committed to working with parties across the political spectrum.
“We are committed to working with parties across the political spectrum on a way forward that enables pubs to thrive as cultural and community hubs,” he said.
“Reducing the tax on beer, a fair system of business rates and a reduced rate of VAT for pubs are moves that we have argued for over many years and these measures would significantly reduce the pressure on pubs’ bottom lines.
“We look forward to constructive engagement with the party as we move through this parliament to chart the optimum path towards a truly sustainable future for the great British pub.”
Punch Pubs CEO Andy Spencer struck a similar tone, welcoming tax reform in principle while avoiding direct political alignment.
“Pubs sit at the heart of communities across the country and play a vital economic and social role,” he said.
“We want to work constructively with all political parties to ensure the great British pub can thrive. Measures that ease the cumulative tax burden on our sector, including changes to VAT, beer duty and business rates, are both essential and welcome if pubs are to invest, grow and continue serving their communities.”
The British Beer & Pub Association (BBPA) said that significantly reducing the overall tax burden and cost of doing business is key to ensuring pubs remain at the heart of communities and boost the economy.
A BBPA spokesperson said: “Given the unique and treasured role pubs play in our communities, culture, and job market, we’re pleased that political parties of all stripes are recognising the value of the local and want to ensure their success.
“Significantly reducing the overall tax burden and cost of doing business are key to ensuring pubs remain at the heart of communities, boost the economy, and keep people in jobs. It is important that all pub-operating models are supported to enable this.
“We’ll continue to work with all parties to ensure that the industry has a voice and plans are evidence-led, proportionate, and have the sector’s best interests at the heart of them.”
Political scrutiny
The proposals have faced criticism from Conservative MP Mel Stride, who questioned the costings behind Reform’s plans.
In a series of posts on X, Stride claimed Reform had understated the cost of reversing Labour’s changes to employer national insurance contributions for hospitality, arguing the figures “are simply made up” and warning that unfunded pledges could risk higher borrowing and debt.
Reform’s proposals have also drawn criticism from other MPs, who have questioned the proposed funding mechanism.
Barrow and Furness MP Michelle Scrogham described the approach as “unbelievable”, while Liberal Democrat MP Tim Farron said support for pubs should not be funded “off the back of some of the poorest people in our communities”.
The debate comes as operators continue to face elevated labour costs, business rates and energy bills, with many that structural tax reform is essential to long term viability.
