Autumn Statement 2016: Five things hospitality wants to see

By Sophie Witts contact

- Last updated on GMT

Autumn Statement 2016: Five things hospitality wants to see

Related tags: Chief executive, Taxation in the united kingdom

Chancellor Philip Hammond will deliver the UK’s first post-Brexit budget on 23 November, but what are the issues the hospitality industry wants to see addressed?

Hammond is reportedly looking to ‘future-proof the economy’ as Britain prepares for to exit the European Union.

But with many hospitality firms seeing costs rise with the falling pound, businesses are seeking reassurance from the Government.

Boost for beer

As such, the industry is urging the Chancellor to protect the pub sector by maintaining a freeze in beer duty, and consider a cut in next year’s Budget.

Twenty-one pubs currently close per week in the UK, and the Campaign for Real Ale (CAMRA) is calling on the Government to help the sector keep prices down.

“With UK beer drinkers paying significantly higher duty on their pint than other leading beer drinking nations, at 52.2p on the pint, we are seeing a significant shift from people drinking in pubs to people drinking at home,” said CAMRA national chairman Colin Valentine.

“[Pubs], and the valued role that they play in society, should remain a priority for this Government.”

The British Beer and Pub Association (BBPA) said it was ‘crucial’ that beer duty was ‘lower at the end of this Parliament than it was at the start’.

Freeze wine duty

Likewise, the Wine and Spirit Trade Association (WSTA) has warned that any increases in wine duty could have ‘dire consequences’ for the sector.

As 99 per cent of the UK’s wine is imported, the WSTA has predicted that the falling sterling could see the price of a bottle rise by 29p.

“It is not only consumers who will feel the impact of price rises, but also by more than a quarter of million employees in the world leading UK wine industry,” said WSTA chief executive Miles Beale.

Cut Tourism VAT

The long-fought campaign to Cut Tourism VAT from 20 to five per cent has picked up momentum since the Brexit vote, with trade bodies hopeful that the Government will re-think the rate ahead of leaving the EU.

Ufi Ibrahim, chief executive of the British Hospitality Association (BHA), said the cut would ‘benefit businesses and families across the UK’.

She added that a rumoured reduction in Air Passenger Duty was ‘unfathomable’ at a time when the Tourism deficit was in excess of £14bn.

“The Government needs to look closer to home and create fiscal incentives which support UK businesses, not businesses in France or Germany,” said Ibrahim.

Business rates reform

April 2017 will see the first revaluation in business rates in seven years, with London pubs set to be the hardest hit.

Venues in the capital will see their bills rise by 25 per cent on average over the next five years, compared to nine per cent for the rest of the country.

The BHA is calling on Hammond to maintain rates at the 2010 position, while the Association of Licensed Multiple Retailers (ALMR) wants there to be at least two years of transitional relief to off-set the hike in bills.

Kate Nicholls, chief executive of the ALMR, said: "Business rates have long been an area of concern and it is well past time that the Government took action to ensure that businesses remain competitive and have the capacity to invest, support jobs and grow.”

Craig Allen, director of hospitality recruiter The Change Group, added that the Chancellor should give the sector the right to appeal against rate rises.

“High rates favour large national chains and make it harder for innovative independent bars and restaurants to compete,” said Allen.

“The result is that every high street looks the same, and are much less appealing for the customer, which eventually leads to a reduction in footfall for everyone.”

Reduce National Insurance

In the face of the industry’s growing skills shortage Change Group is also calling for a reduction of Employers’ National Insurance for under 25’s.

The recruiter said it would encourage firms to offer greater ‘opportunities to young and inexperienced people’ and ‘develop a stronger pool of experienced British hospitality talent for the future’.

“Recruitment is still a challenge, and may become worse depending on the terms of Brexit,” said Allen.

“The Chancellor needs to do more to help this vital industry and quickly to boost confidence.”

BigHospitality will be covering the Autumn Statement and its impact on the hospitality sector following its announcement on 23 November.

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