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News > Business

'We need a rates freeze' hospitality leaders tell ministers

By Luke Nicholls , 14-Nov-2011
Last updated on 14-Nov-2011 at 14:30 GMT

Chief executives of the UK’s pub, hotel, restaurant and leisure industry trade bodies have today hit back at huge hikes in business rates planned for next year in a letter to cabinet ministers Eric Pickles and Vince Cable.

In the letter, the leaders of the British Beer and Pub Association (BBPA), the British Hospitality Association (BHA) and Business in Sport and Leisure (BISL) claim that next year’s rates rise of 5.6 is 'unprecedented' and will add a massive amount of pressure to a wide range of businesses.

No justification

Brigid Simmonds, chief executive of the BBPA, said: “Council tax has been frozen by the Government – and rightly so. Given the benefits it could bring, we need the same approach for business rates. Our leisure and hospitality sector is dominated by small business, like pubs, hotels and restaurants, and they are absolutely key to creating new jobs.”

“We need a rates freeze,” added Ufi Ibrahim, BHA chief executive. “The VAT rise in January hit our businesses hard, with extra taxes on pub and restaurant food, while supermarket food remains zero rated.

“This is widening the gap between eating out and eating at home. There is no justification for further pain in what are labour-intensive parts of the economy, where jobs can be created.”

Dominic Harrison, BISL chief, stressed the importance of a rates freeze. He said: “Business rates are one of the highest costs on businesses. They feed through to the prices of goods and services, reducing customer visits.

Timing couldn’t be more vital

“A freeze would send a clear signal that the Government really understands that we are vital to generating growth and jobs in the economy, and growing our way out of recession. With current uncertainties, the timing couldn’t be more vital.”

The letter, addressed to secretaries of state Pickles and Cable, concludes: ‘The BBPA, BHA and BISL urge the Government to recognise the industry’s concerns and freeze business rates for the coming year. To do so would not only be prudent but would send a clear signal to businesses that the Government is supportive of its efforts to generate growth, create jobs and invest in the UK economy.

‘We would very much welcome the opportunity to discuss the proposed increase further with you.’

Just last week, BigHospitality reported that delays in processing business rate appeals are costing hotels in England over £13m every year .

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