A freeze in beer duty, increase of the national living wage and rural rates relief were among the significant announcements for licensees made today in Chancellor of the Exchequer Phillip Hammond’s Autumn Statement.
Hammond revealed a continuation of the beer duty freeze, which was welcomed by the Campaign for Real Ale (CAMRA) but the organisation also called for it to continue in the April 2017 budget.
Colin Valentine, CAMRA’s National Chairman, said, “CAMRA welcomes the Chancellor’s decision not to raise beer duty in the Autumn Statement. Pubs are under a huge amount of financial pressure and with UK beer drinkers paying 52.2p of duty on their pint we are seeing more and more people choosing to drink at home rather than at their local.
“This trend not only hurts UK businesses, but is also contributing to the demise of our communities and affects people’s personal well-being”
He added, “While a freeze in beer duty is welcome, CAMRA would like to see the Government do more to reverse the damage done by the beer duty escalator by cutting duty in the 2017 Budget.”
Brigid Simmonds, Chief Executive of the British Beer & Pub Association (BBPA), agreed. She said, “There have been no increases in beer duty rates, which is welcome, but duty accounts for up to 50 per cent of the costs of a UK brewer and remains a concern for the industry.
“Our rate of beer duty in Britain is considerably higher than all other major European brewing nations, and we are now calling on the Chancellor to cut beer duty in the 2017 Spring Budget, and tackle the unfair burden it places on Britain’s beer drinkers, publicans and brewers.
National minimum wage
Hammond also confirmed that the national living wage for over-25s would rise to £7.50 in April 2017, meaning an extra £600 for applicable staff members. The national minimum wage will also increase.
Simmonds said this could represent a challenge for the on-trade. She commented, “We understand action to help those on low pay, but given the current economic uncertainty there is a real need to look at the cost pressures facing pubs.
“Increases in the National Minimum Wage and Living Wage represent challenges for our sector, particularly in pubs, where labour costs are high, at between 14 and 25 per cent of operating costs.”
Rural business rates
But the 100% rates relief for rural businesses was welcomed, with Simmonds adding, “The doubling of Rural Rate Relief provides a welcome correction to an anomaly that would have penalised rural pubs, with pubs that qualify now able to claim 100 per cent relief on their business rates through the rural relief scheme.
“Whilst we support the reduction in the cap on transitional rate relief, the BBPA and other industry bodies had written to the Chancellor calling for broader support on business rates, prior to his announcement today. We want to see enhanced relief for pubs that will be hit hardest by the 2017 revaluation, and an overall review of how rates impact on Britain’s pubs.”