Hospitality associations in the UK have welcomed the new draught duty relief announced in the Spring Budget but remain concerned that not enough support is being provided for the struggling sector.
When the alcohol duty freeze comes to an end in August, the draught duty relief of between 5% and 9.2% will mean that the amount companies pay in tax per pint served will not increase with inflation.
Emma McClarkin, chief executive at the British Beer and Pub Association said: “The cut to draught duty as part of the alcohol duty reform is positive and we hope that it will result in a boost for our pubs this summer.
“However, the fact is, our industry will be facing an overall tax hike, not a reduction come August.”
McClarkin argued that relief won't offset the duty for non-draught beer, soaring inflationary costs and “unfair energy contracts” facing the industry.
Post-Covid hangover remains
Pubs across the country could be left struggling on April 1, when support for energy costs comes to an end.
UKHospitality chief executive, Kate Nicholls said she was pleased by the government's plans to get more people into the workplace.
“Hospitality businesses are continuing to struggle, with vacancies running at 56% higher than pre-pandemic levels,” she said.
Nicholls also highlighted industry fears about energy prices, adding that urgent action was required to address some of the failures made by providers, which Ofgem recently identified.
She concluded by calling the relief a positive step but hoped that these types of tax cuts could be put in place across the wider drinks market.
The Society of Independent Brewers (SIBA) reiterated similar points to both Nicholls and McClarkin and identified that the headwinds facing the hospitality sector were the same for small brewers.
“The extent of the stubborn post-Covid hangover for pubs still remains, with a worrying 20% of people having not visited a pub in the last twelve months,” said Andy Slee, SIBA chief executive.
Many of the larger pub owners are also suffering, with companies like J D Wetherspoon and Marston’s both listing multiple venues for sale in recent months.