Thank you for contacting me recently about taxation on beer and pubs. I know that this important issue will be of concern to many people in our area.
The pub sector supports 900,000 jobs, generates £23 billion in economic value and provides £13 billion in tax revenues. In addition, 30 million adults visit the pub every month. I agree that pubs are at the heart of the UK’s communities and play an important role in our national economy. I also appreciate that pubs continue to be under severe threat and I agree that we must do what we can to support them.
I am aware that there has been speculation that the Chancellor is considering lifting the freeze on alcohol duty – which covers beer, wine, spirits and cider. The Government has said that successive beer duty freezes have cost over £4 billion since 2013-14 and indicated that any assessment would need to consider the resulting reduction in funds available for public services.
I appreciate your concerns about the level of beer duty. Indeed, I opposed the Government’s decision to increase alcohol duties at the 2017 Spring Budget, as I believed that the increase posed a risk to pubs, particularly at a time of rising business rates and rising inflation.
On business rates, the Government announced that it would continue the £1,000 discount for pubs with a rateable value up to £100,000 in 2018-19. However, I am concerned that this relief still represents only a temporary respite rather than long-term support. I believe we need a fundamental review of business rates, including making revaluations annual to stop small businesses from facing sharp and unmanageable increases.
On beer and pubs more widely, at the 2017 general election I stood on a manifesto that committed to set up a national review of local pubs to examine the causes for their decline, as well as establishing a joint taskforce that will consider their future sustainability. I also pledged to give communities more power to shape their town centres, including by strengthening powers to protect pubs.
The Chancellor is due to outline spending and tax plans at the Autumn Budget on 29 October 2018. I can assure you I will continue to call for pubs to be given the support that is necessary for them to thrive and grow.
Thank you once again for contacting me about this issue.
Derek Twigg MP