Late Night Levy: Forum of Private Business warns Government on 'stealth tax'

12-Apr-2012 - Last updated on 13-Apr-2012 at 10:39 GMT

Related tags Late night levy High street Government

Phil Orford, chief executive of the Forum of Private Business, who has warned the Government on the impact of the proposed Late Night Levy

The Forum of Private Business has warned the proposed introduction of a Late Night Levy (LNL) is little more than a 'stealth tax' against business and will further harm pubs and operators catering for the night-time economy.

In a letter to Lord Henley, who has been appointed by the Government to conduct a consultation exercise for the proposals, Phil Orford, chief executive of the Forum, argues it will further harm the profitability of the high street at a time when the Government says it is committed to helping town and city centre businesses.

Orford said the LNL would also contradict the Department for Business, Innovation and Skills’ (BIS) plans to cut new regulations for small businesses.

"It's a huge irony that last week Communities Minister Grant Shapps wholeheartedly embraced the contents of the Portas Review, and remarked on the need to make high streets central to communities across the country. Yet on the other hand we have a Government plan taking shape to introduce a new stealth tax which directly targets high street businesses. It’s hardly joined-up thinking," he said.

"We would also say this goes against the moratorium by BIS for new regulations for small firms. The Government argues it is business friendly, but then sends out a completely different message," Orford added.

Business rates

The letter also tackles the issue of business rates which the Forum says having just risen by 5.6 per cent are, along with lower consumer spending, already hitting small businesses hard even before the introduction of a LNL.

Earlier this month the business rates specialists CVS said the Portas Review, designed to revive the High Street, would come too late because of record-high business rates which were not addressed in the Government response to the recommendations in the review.

A Late Night Levy has been proposed by the Home Office to allow licensing authorities to introduce a charge for premises that have a late alcohol licence in part to pay for the extra charges police and local authorities incur from the night-time economy.

It was also mentioned in the Alcohol Strategy published by the Government last month.

Pubwatch

However Orford said the LNL would not tackle the problems the Alcohol Strategy was designed to address. "The Forum believes imposing a levy is not the best way to deal with the issue of late night drinking either. Drinking culture is a complex issue, and won’t be solved simply by crudely levying extra taxes on firms which is a sticking plaster approach at best," he said.

Orford concluded that the Government should encourage voluntary schemes and initiatives such as Pubwatch schemes instead.

At the beginning of March the National Pubwatch chairman, Stephen Baker, said local pubwatch schemes should respond to the Government consultation on the LNL and encourage the promotion of Pubwatch schemes or allow members of such schemes to receive a discount.