Join our new WhatsApp channel: The Morning Round-Up
Get the biggest pub trade stories straight to your phone. Listen to our one-minute daily news briefing and receive breaking news, exclusives and sector updates throughout the day....just remember to turn notifications on in top right corner!
This followed findings from the BII’s survey of its members, which showed a quarter of pubs reported making a profit between January and August this year.
The poll also found one in five expect to close if the current cumulative tax burden remains. Should taxes increase again, the figure rises to two in five.
However, the trade body also outlined if VAT was cut to 10% on all pub sales, three quarters (75%) of its members would invest in their pubs while six in 10 (62%) would increase staff ours and grow their teams with one in two would spend more with local suppliers.
This comes as the #VATsTheProblem campaign, which is backed by a number of voices in the sector including the BII, reached almost 390,000 signatures.
Costs undermining businesses
The figures were highlighted in a letter to the Prime Minister and Chancellor from BII boss Steve Alton where he called on the Government to ‘back our pubs and they will deliver in every community’ ahead of the Budget in a months’ time (Wednesday 28 October).
He said: “Our members are ready to invest. They want to develop their pubs, grow their teams and spend more with the local businesses that supply them. Give them a fair tax deal and that investment will reach communities across the UK.
“But even after a strong summer for trade, too many publicans have little profit to show for the long hours they put in.
“Staff costs, energy bills and unfair cumulative taxation are undermining businesses that communities depend on.
“Around 40p in every £1 spent in a pub now goes to the Treasury. That is holding back the very investment, employment and growth the Government wants to see.
“The warning in our survey is stark. If taxes rise again, two in five of our members expect to close. These are people running good, long-standing pubs.”
Trade body warning
Alton went on to lay out the impact of pub closures on the wider communities they serve.
He added: “Losing them would mean lost vital local jobs, support for local suppliers and places that bring people together in communities.
“Prime Minister, Chancellor, use this Budget to give pubs a fair deal, with 10% VAT on all pub sales at its heart.
“Back our publicans and they will deliver in every postcode. Tax them harden and thousands of communities could lose their pub.”
This followed more than 800 businesses signing a separate open letter, organised as part of the #VATSTheProblem campaign, urging Burnham to set out plans for a lower rate of VAT for the sector.
