It’s no secret that pubs are under increasing pressures, including business rates, which could mean the closure of almost 4,000 pubs.
Operators have previously hit out at the amount of tax pubs pay, when compared to supermarkets. JD Wetherspoon (JDW) boss Tim Martin called on other pub companies to get behind a campaign of tax equality.
“Supermarkets pay no VAT on food and they only pay 2p a pint on business rates while we pay 18p per pint,” he told The Morning Advertiser last year (November).
“This is way below the cost price of a pub when you factor in just the basic rent, wages, etc. When you add to the fact it costs is 90p a pint in wages to sell it, the tax burden becomes too much."
The Morning Advertiser compared the average cost of a 25ml measure of Gordon’s gin (classed as ‘standard’ gin) across four supermarkets (Tesco, Sainsbury’s, Asda and Waitrose) was 44p.
Investigation
Definition of standard, premium and super-premium gin (according to CGA; prices relate to off-trade only):
Standard – up to £25 per litre
Premium – £25 to £40 per litre
Super premium – more than £40 per litre
According to data experts CGA, the average cost of Gordon's gin 25ml measure was £2.70 – some six times more than it is in the off-trade.
When it came to ‘premium’ gin, the average cost of a 25ml measure of Tanqueray at a supermarket is 52p – a fraction of the average price in the on-trade at £3.43.
In the ‘super-premium’ category, the average cost of a 25ml measure of Hendrick's in the off-trade is £1, a huge drop from the average cost at a pub of £3.87.
Trade body the Wine & Spirits Trade Association (WSTA) is calling on Chancellor Philip Hammond to freeze alcohol duty at the Budget later this month (29 October).
Show support
WSTA chief executive Miles Beale said: “The Chancellor can once again show his support for the great British pub by scrapping his plans to raise already punitive duty rate.
“Wine and spirits are increasingly vital to the prosperity of our historic British pubs with wine and spirit duty accounting for more than one third of annual pub sales.
“We are calling on Philip Hammond to recognise the importance of the wine and spirit industry and help save our British pubs by freezing duty, allowing them to reinvest and stay in business.
“It is proven that freezing alcohol duty has brought in more revenue for Treasury coffers, not less, so a duty freeze makes sense for everyone from the Chancellor, to pub and bar owners, and consumers.”
