A freeze in beer duty has emerged as the overwhelming priority for industry trade associations, ahead of this month’s Budget.
The plea was made in submissions by the British Beer & Pub Association (BBPA), the Association of Licensed Multiple Retailers (ALMR), the Campaign for Real Ale and the Society of Independent Brewers, in advance of Budget day on 19 March.
The groups argue a duty freeze would create jobs — up to 2,400 in the first year, according to the BBPA — and contribute to growth in the pub and beer sector.
“There is a compelling case for a beer duty freeze,” said BBPA chief executive Brigid Simmonds. “The Government has made an excellent start in abolishing the beer duty escalator and with the historic cut in duty last year. It’s been a real boost to jobs and growth in the sector, at a time when the economy most needs it; a freeze can be achieved with virtually no cost to the Treasury.”
The ALMR said tax policy remained the single biggest barrier to growth in the sector, and stated that the average pub now pays just under half of its turnover in taxes of one sort or another, while operating costs arising from legislation are up 13%.
It said measures were needed to manage the rising cost of labour, suggested the removal of the alcohol duty escalator, called for no rises in machine game duty and proposed a reduction in the rate of VAT for the licensed hospitality sector to 5%.
“A reduced rate of VAT in the hospitality sector to 5% in the UK could create 670,000 jobs in the sector, at a fiscal cost per job of only £1,200 and reduce customer costs in the sector by 9% in real terms,” its submission stated.
The Forum of Private Business (FPB) called for a fundamental review of business rates. It also insisted support was needed to help small firms with rising business costs, appealed against national minimum wage increases significantly above inflation and demanded the introduction of effective ways to tackle late payment.
“Small businesses are grateful for the measures announced in the Autumn Statement to mitigate the rising costs of business rates, but a more fundamental review is needed,” said Phil Orford, FPB chief executive.