Government business rates U-turn ‘huge relief’ – but pubs warn ‘more needs to be done’
Pub owners have welcomed news the government is ready to make a U-turn on plans to scrap business rates relief for the hospitality industry but warned it may not be enough to keep the doors open.
In the budget the chancellor announced plans to reduce the business rates discount, which has been in place since the pandemic, from 75 per cent to 40 per cent and said there would be no reductions from April this year.
The announcement was met with anger among pub owners, with many warning they were already on the verge of closure due to the ongoing struggle in the years since the pandemic.
The Chancellor is expected to extend benefits to help homeowners facing rising bills rather than scrap the April cash boost, ministers have said Independent.
Pub owners said the move was “positive news” for an industry “in desperate need of help”, but many added they still had concerns about other measures introduced by the government.
‘Anything helps at this point’
Dawn Hopkins, 56, who runs the Rose Inn in Norwich, said the U-turn news would be a “huge relief” for many pubs but added there were still concerns about the reassessment of business rates.
“Getting the discount back would be a huge relief and anything helps at this point,” said Hopkins, who is also vice-president of the Pub Campaign. Independent.
“But a big problem is that they’ve done a reassessment of business rates, which are astronomical in many places,” he said. “So it would be great to get the reduction back, but we still need to look at revaluation.”
‘Most of the damage needs to be compensated’
Chris Welch, 39, who runs Fishnet Tavern in North Tyneside, said: “It’s really positive news that this has happened, but I still think more needs to be done.”
Mr Welch, who said the business rate would rise by an extra £4,000 a year after the Budget, said: “I would say we will need cuts to VAT and other tax cuts. I know I sound greedy, but the sector needs major help to help the recovery. There’s a fair amount of damage that needs to be undone.”
“But anything helps at this stage.”
‘A great start in correcting the mistakes that have paralyzed successive budgets’
Tom McNeeney, who has run The Oxford in Rochdale for 13 years, said the U-turn was a “great start to righting the wrongs” but fears it will not be enough to save many pubs.
“We cannot emphasize enough how desperately this U-turn is needed in an industry that is about so much more than pines and pies,” he said Independent.
“The government acknowledging the need for a U-turn will unfortunately not be enough to save many pubs, but it is a great start to righting the wrongs of successive crippling Budgets for the sector.
“If we can see the value in rethinking business rates reform, then it wouldn’t be too much to ask for the government to take this moment to take some action that will actively save these vital businesses in our communities, rather than returning us to where we were a few months ago.”
He added: “Our pubs, with their rich history and the social impact they have, are the lifeblood of many of our communities. The impact of a pub closure on the lives of not only those who work there but also those around them is far-reaching: they are places that add social value, eliminate loneliness and provide jobs for hundreds of thousands of under-25s who have never found it harder to get into work.”
‘An open bar pays taxes, a closed bar does not.’
Fiona Hornsby, 45, who runs three pubs in Liverpool, said the U-turn was “great news” but added that “the newly increased taxable value would also be better scrapped”.
“This is certainly good news as any cost increases will unfortunately have to be passed on to the customer. In a cost of living crisis this is not ideal: with less money to spend pubs are becoming a treat,” he said Independent.
But he said the number of government U-turns was “becoming ridiculous” and added: “They are not listening to trade bodies or business leaders in any meaningful way.”
“An open bar pays taxes, a closed one doesn’t,” he said, adding that one of his bars now has a price value 40 percent higher than its rent. “Labour promised in a manifesto that business rates would be overhauled and a new, fairer system would be put in place to help the high street.”
‘No one can really plan or think’
Alex Greig, owner of Fuggles Beer Cafe in Tunbridge Wells, believes any reversal of business rates reform would be “positive” but the government needs to do more to help tackle small businesses.
Mr Greig said the U-turn was “helpful” but “nowhere near enough” to save small businesses suffering from rising energy bills, national insurance rises and minimum wage rises.
“I’ve been doing this for 20 years and I’ve never known anything like the resulting devastation we’re seeing now,” he said. Independent.
He said the government’s current phased approach to reducing business rates relief was just “knocking the can down the road” and accused ministers of “prolonging the apocalypse”.
“We just need to stop,” he said.
He added that the government’s inconsistent approach to policy makes it difficult for people like him to make big decisions.
“Nobody can really plan or think,” he said. “Make your mind up; this is crazy.”
Why did you do this in the first place?’
John Pybus, landlord of York’s smallest pub, The Blue Bell, described the business rates reform announced in the Budget as a “betrayal” and added that any reversal would be “welcomed by the industry”.
“But we have to ask, why did you do this in the first place?” He said business rates, national insurance increases and alcohol duty were the “cumulative burden” of the problems the sector had faced over the past few years.
‘Wider issues need to be addressed’
Jo Loring, who runs the Cozy Dove bar in Newcastle, said in response to the U-turn that “wider issues need to be addressed”.
“A U-turn on business rates would be welcome and should take the rates a business pays closer to what they currently pay,” he said.
“While lowering rates would be beneficial, wider issues such as wholesale prices and beer bonding need to be addressed. It doesn’t seem fair for a pub to pay twice the wholesale price as the pub next door.”
‘The government must act before it is too late’
The British Beer and Pub Association (BBPA) said it was “encouraging” that the government was listening to the industry but advised that a pub-specific business rates discount would be the “simplest” way to help the sector.
Emma McClarkin, chief executive of the BBPA, said: “The clock is ticking for too many pubs who fear they won’t be able to withstand shocking new bills.
“It is encouraging that the government is listening to the industry and appears willing to deliver on its promise to support pubs, but it needs to act before it is too late.
“Pub-specific business relief is the quickest, simplest and fairest way to ensure our local people don’t disappear, jobs don’t disappear and communities don’t lose their valued centres.”
