\n<\/p>\n
Pubs face widespread closures unless the chancellor announces an extension to business rates relief in next week’s Budget, the UK’s biggest pub company has warned.<\/p>\n
David McDowall, boss of Stonegate Group, whose pubs include Slug & Lettuce, Yates’s and Walkabout, said thousands of landlords currently make just 12p of profit for every pint of beer they sell.<\/p>\n
Help on business rates for the hospitality sector in England and Wales is set to run out in April. <\/p>\n
Mr McDowall said that if it is removed, small publicans will see their business rates bill quadruple from April.<\/p>\n<\/div>\n
Along with other costs the businesses are facing, he feared “they don\u2019t have any more to give”.<\/p>\n
Rates relief was introduced for pubs, restaurants, bars and cafes in 2020 in response to the Covid pandemic when businesses were forced to close.<\/p>\n
In the Budget in November last year, the then Chancellor, Jeremy Hunt, announced it had been extended until April next year.<\/p>\n
The measure means that companies in England can claim 75% relief on business rates up to \u00a3110,000, or 40% for firms in Wales.<\/p>\n
Mr McDowall told the BBC’s Today programme that the hospitality industry has faced a “barrage” of challenges in recent years.<\/p>\n
These include recovering from Covid as well as high inflation, energy costs in the aftermath of Russia’s invasion of Ukraine and the effect of the cost of living on customers.<\/p>\n
“The complete removal of that rate relief would prove very, very costly for pubs, bars, restaurants and cafes up and down the length and breath of the UK”, he said.<\/p>\n
The British Beer and Pub Association recently revealed that landlords make 12p profit per pint. The average price of a pint of draught lager was \u00a34.79 in September, according to the Office for National Statistics.<\/p>\n
Meanwhile, a freeze on alcohol duty is scheduled to end on 1 February next year.<\/p>\n
Mr McDowall is one of a number of representatives from the hospitality industry who this week signed a letter to Chancellor Rachel Reeves asking for relief to be extended.<\/p>\n
It warned about “the onrushing business rates cliff edge” facing firms 153 days after she delivers the Budget.<\/p>\n<\/div>\n
On Thursday, UKHospitality and the British Retail Consortium, whose members also benefit from relief, said that in the year to March, businesses in these sectors paid nearly \u00a39bn in business rates.<\/p>\n
This is nearly a third of the total amount of revenue the government raises from business rates.<\/p>\n
They said that if relief is removed, it would cost hospitality and retail an additional \u00a32.5bn.<\/p>\n
Earlier this week, UKHospitality also called on the chancellor to stick to Labour’s manifesto pledge to reform business rates.<\/p>\n
The amount businesses pay is based on how much annual rent could be charged on the premises – which is known as the rateable value.<\/p>\n
UKHospitality argued that, because its businesses can usually be found in central locations such as High Streets, the cost to companies is high.<\/p>\n
Without reform “investment in our high streets will be curtailed, employment opportunities will be squandered and ultimately, we will see higher levels of business failure,” it said.<\/p>\n
A spokesperson for the Treasury, said: \u201cWe\u2019re supporting businesses like our well-loved pubs through pledges to make the business rates system fairer, cap corporation tax at 25% and to publish a corporate tax roadmap so that they have some welcome certainty to plan for the future.\u201d<\/p>\n<\/div>\n