In a letter to the office of Exchequer Secretary to the Treasury, Robert Jenrick MP – seen by The Morning Advertiser– Save UK Pubs revealed that some pubs have seen more than fivefold increases in rateable value since business rates reform in 2017.
New measures introducing fair maintainable trade as a means of establishing rateable value as opposed to footage-based methods have yielded “massive increases” according to the group, which wrote to the Treasury ahead of a general debate on beer taxation in the House of Commons on 7 February.
The letter was written after Save St Albans Pubs – which has since rolled out its campaign nationwide under the moniker Save UK Pubs – and St Albans MP Anne Main met Jenrick to voice the group's concerns over fair maintainable trade as a means of establishing rateable value and calculating a pub’s business rates.
Four out of five pubs’ rates increased
In October 2018, Chancellor Philip Hammond announced a one third cut in business rates for pubs, shops, restaurants and cafés with a rateable value of up to £51,000 in his Autumn Budget on 29 October.
However, research by the Altus Group found that more than 5,000 pubs could be worse off as of April 2019 given the large number of pubs ineligible for the aforementioned discount.
Research by Save UK Pubs disclosed in its letter to the Treasury – encompassing Marlow in Buckinghamshire; Maidenhead in Berkshire; Brighton & Hove and Lewes in East Sussex respectively; the Suffolk Coast; Tenby and Cardiff in Wales; Newark in Nottinghamshire; Burnley in Lancashire; and the St Albans district in Hertfordshire – found that in most cities almost a third of pubs have seen their rateable value increase by more than 30%.
The group’s findings also revealed that in the majority of cities examined approximately 80% of pubs’ rateable value rose, with a 567% leap witnessed by a pub in Newark the largest increase found.
In Brighton & Hove, for example, of the 239 pubs reviewed by Save UK Pubs, three quarters (74%) saw their value increase, with more than one in 10 (15%) seeing it more than double. The largest increase for a single venue was 373%.
Collectively, rateable values in the East Sussex city increased by more than £2.5m.
Research can be read in full on Save UK Pubs' website.
Calls for reform
In addition to the introduction of a streamlined and transparent pub rateable values system, Save UK Pubs is urging the Government to take a number of steps to reduce the financial burden on pubs.
It is calling for an amendment to Hammond’s Autumn Budget pledge so that the proposed rate relief for small businesses with rateable values of £51,000 or less will apply to all pubs as well as a freeze in the next budget.
Moreover, the group is demanding a nationwide review of the business rate tax formula, in consultation with pub companies and industry campaigners, to develop a workable business rate formula.
According to campaigners, Save UK Pubs has a meeting with the treasury at the end of February 2019.
General debate on beer taxation
As reported by The Morning Advertiser, the Government recently launched an enquiry into the impact of the current rates system on businesses, with a deadline of 2 April 2019 for written contributions.
Moreover, on 31 January, the leader of the House of Commons announced that a general debate on beer taxation would take place in the house on 7 February.
Commenting on the announcement of the debate, Brigid Simmonds, chief executive of the British Beer & Pub Association (BBPA) said: “This backbench debate on beer taxation and pubs will be a fantastic opportunity for MPs to call on the Government for further action to support pubs and breweries. Congratulations to Mike Wood MP for securing it.
“MPs will also be able to show their support for the Long Live the Local campaign to help save the great British pub.
“The BBPA will be briefing MPs ahead of the debate and looks forward to the Government’s response."