Community pubs minister Bob Neill has said the Coalition would be unwilling to back a VAT cut to 5% for the sector because it could threaten Government revenue, writes Adam Pescod.
Neill was questioned by Robert Wicks, manager of the Westerham Brewery Co in Kent, along with local MP Michael Fallon on a visit to the company to find out what challenges the industry is facing.
Wicks told M&C Report's sister publication Publican’s Morning Advertiser that he himself supported our Thrive on 5 campaign to reduce VAT to 5% across the hospitality industry.
However, while Neill told Wicks it was “an interesting idea”, he said he would be unwilling to support a policy that could threaten Government revenue.
It comes as Treasury minister David Gauke said in Parliament that the Government had “no immediate plans” to assess the impact of Ireland’s recent VAT cut to 9% on the sector, while tourism minister John Penrose and played down its expected impact on UK tourism.
Wicks also told the visiting Tory MPs that the beer duty escalator is “very bad news”.
He added: “What we are seeing is a switch away from beer being consumed in well-regulated environments with sales increasing dramatically in the off-trade.
“The unforeseen policy of the Government has resulted in a massive shift from on to off-trade consumption, and this obviously takes place in an unregulated environment.
“Nobody on the checkouts at supermarkets is trained to provide any advice on alcohol consumption.
“This is a significant reason why we have an alcohol problem at the moment.
“People are consuming alcohol at home, and this is also leading to the problems we are currently having in hospitals.”
Neill said: “We are committed to supporting the continued role of pubs at the heart of communities.
“We want to see these pubs thrive and prosper at a time when the economy is in recovery.
“That’s why we are reviewing restrictive red tape, helping firms with business rates and handing power to communities to step in and take over and preserve their local.”
