UK Government's Tax Policies Killing British Pub Industry, Report Warns

by Robert Lee, Tax-News.com, London

17 September 2008

Government taxes and red tape are damaging Britain’s brewing and pub sector as it grapples with one of its most severe periods of economic pressure on record, according to a new report published on Monday.

The report, 'A Wake up For Westminster – a new and comprehensive analysis of the challenges facing the sector,' by the British Beer and Pub Association (BBPA) contends that government policies on tax and regulation have severely restricted business flexibility and are hampering the sector’s ability to respond to economic change.

The report highlights the fact that pub beer sales have sunk to the lowest level since the Great Depression of the 1930s and that pub closures, at five a day, have reached unprecedented levels.

However, the BBPA warns that the situation is unlikely to improve as the government prepares to increase beer taxes by a third over the next four years, and introduce a raft of new red tape, such as a new mandatory code of practice, which will add more layers of bureaucracy to how alcohol is sold in Britain.

The BBPA is calling for the government to abandon its plans for a beer tax escalator, as well as plans for new, mandatory codes of practice on how alcohol should be sold. They are also calling on Government to focus on enforcing the existing rigorous laws, rather than create new ones.

“The economy is shrinking, drinking trends are shifting and overall consumption is sinking. Now is not the time for the government to be introducing policies that will force up prices for all," argued BBPA Chief Executive, Rob Hayward.

“The government should abandon its plans for more punitive tax rises on beer, and should concentrate on enforcing existing laws rather than introduce new ones. If we don’t have a change of approach, many more communities will be without their much-loved pubs," he concluded.

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