UK: Chancellor faces tax loss from pub closures
The Treasury is facing a black hole of GBP242m (US$352m) in lost tax revenue due to pub closures since the last budget, according to figures released today (20 April).
The figures, issued by the British Beer & Pub Association (BBPA) showed that each pub, on average, pays a tax bill of GBP107,000 a year - representing 30% of turnover - with the pub sector's total annual tax bill running to GBP6.1bn.
With UK pubs now closing at a rate of 39 a week, the Chancellor's budget black hole is growing at the rate of over GBP4m a week due to pub closures alone, the BBPA said today (20 April).
Since last year's Budget, around 2,200 pubs have closed, with the loss of over 20,000 jobs, the association said.
The BBPA said that this latest evidence "strongly supports" the case for Darling to "abandon the beer tax escalator" he announced in the last budget and introduce a "beer tax freeze".
David Long, chief executive of the BBPA said: "If the Chancellor is trying to maximise tax revenues at this particular time then he will shoot himself in the foot by putting up beer taxes. These figures show that pub closures don't just mean lost businesses, lost jobs and a loss to the local communities they serve. They are also a loss for the tax man.
"Freezing beer duty in the budget will help give pubs some of the breathing space they need to fight their way through this recession. If the Chancellor increases beer taxes as he said he planned to do last March, then he will condemn more pubs to close, put more people out of work and lose even more tax revenue."
Nearly a third of members of the UK Parliament signed a petition to get the beer tax rises scrapped in March, which included 97 Labour MPs.
Sectors: Beer & cider
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