Hammond's Budget had failed to address the ongoing disparity in tax between pubs and supermarkets, Martin complained, revealing his company faced combined cost rises of approximately £20m over the next 12 months.
He said: “Last Wednesday’s Budget was presented by the Chancellor as providing tax relief of approximately £1,000 per pub, for pubs with a rateable value of less than £100,000. In fact, that sum is dwarfed by tax and regulatory increases.”
JDW faces a £7m rise in business rates as well as £4m in electricity taxes, £7m in excise duty and £2m due to the apprenticeship levy.
Martin said the proposed sugar tax would cost approximately £4m from April 2018 and he expected to pay further electricity tax increases of roughly £5m by 2020.
'Budget for dinner parties'
Extra costs for JDW:
- £7m rise in business rates
- £4m in electricity taxes
- £7m in excise duty
- £2m apprenticeship levy
- £4m sugar tax costs
He said: “Companies like Wetherspoon, on examination of the fine print of the Budget, are not, in fact, eligible for the £1,000 per annum decrease in business rates, in any event.”
He reiterated calls for tax equality with supermarkets, having told The Morning Advertiser (MA) earlier this month that pubs were destined for “further decline” without progress on the issue.
Martin added: “Wednesday’s Budget will weigh far more heavily on pubs than supermarkets, especially since wage costs per pint or meal are approximately 10 times higher in pubs.
“The Chancellor was less than frank in his Budget speech, since he did not spell out the duty increases, giving the impression to many that there would be no increase.
“In effect, this was a Budget for dinner parties, no doubt the preference of the Chancellor and his predecessor – dinner parties will suffer far less from the taxes outlined above, whereas many people prefer to go to pubs, given the choice.”
JDW total sales down
JDW posted its trading results for the 26 weeks to 22 January this morning, reporting growth in revenue of 1.4% to £801.4m, with like-for-like sales up 3.3%.
However, total sales decreased by 0.2%.
Martin said the company anticipated significantly higher costs in the second half of the financial year.
“In view of these additional costs and our expectation that life-for-like sales will be lower in the next six months, the company remains cautious about the second half of the year.
“Nevertheless, as a result of modestly better than expected year-to-date sales, we currently anticipate a slightly improved trading outcome for the current financial year, compared with our expectations of the last update.”