Guest Blog By Neville Grundy, Southport & West Lancs Camra
On Thursday 23rd September, JD Wetherspoon (JDW) pubs will be cutting the price of all food and drinks by 7.5%. They intend to show how the hospitality industry would benefit from a permanent cut in VAT. The cut will be for one day only as part of the Tax Equality Day campaign.
In July 2020, VAT on food and drink in pubs was cut to 5% to help pubs and restaurants at the height of the pandemic, but from 1st October the Government will be increasing this to 12.5%. Because of this, JDW will have to increase the prices of meals by 50p on Wednesday 29th September. The Government fully intends to increase VAT in the hospitality industry by stages to 20% by the end of the year.
JDW explains that supermarkets pay no VAT on food and can use the money saved to sell alcohol to customers at reduced prices. JDW chairman, Tim Martin, said: “Taxes should be fair and equitable. However, it is unfair that supermarkets pay zero VAT on food, but pubs and restaurants, in normal circumstances, pay 20%. Pubs have been under fantastic pressure for decades due to the tax disadvantages that they have with supermarkets.”
He urged the Chancellor to create tax equality between pubs and supermarkets by making the current VAT regime for pubs permanent. He added: “He [the Chancellor] should note that the main impact of tax inequality is on high streets and town and city centres, which heavily depend on a diversity of prosperous hospitality businesses for economic, social and employment success.”
► Bad news: Southport’s Waterfront pub, the Hungry Horse, is to close. The reason given by owners Greene King is that the lease is coming to an end and will not be renewed. There has been speculation for some time that the owners of the building, Bliss Investment Partners, intend to demolish the building and redevelop the site.
The Hungry Horse is a food-oriented pub serving real ales brewed by Greene King. As I write this, no date for the closure has been announced.
This announcement follows the closure of the Victoria just across the road, although its owners, Thwaites Brewery, state they are advertising for a new tenant to reopen it.