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http://www.bighospitality.co.uk/Business/Hospitality-industry-steps-up-calls-for-VAT-cut-to-boost-business-and-jobs

Brian Simpson, North West MEP and the European Parliament’s chair of transport and tourism, has joined others in the beer and pub sector calling for a freeze in duty, including trade bodies the British Beer and Pub Association (BBPA), the Campaign for Real Ale (CAMRA) and the Society of Independent Brewers (SIBA).

In his letter to the Chancellor, Simpson wrote: “Current beer tax rises in the UK are totally unsustainable. Comparisons with other EU member states make the point very clear. Britons now pay 40 per cent of the entire EU beer tax bill, but only consume 13 per cent of the beer sold in Europe. Beer taxes in the UK are now an astonishing 11 times higher than in Europe’s largest beer market, Germany.

“This is why the industry cannot afford another +5 per cent duty rise in March, which would bring the accumulated rise in taxes since March 2008 to 42 per cent. A freeze in beer duty in the Budget would save 16,000 jobs nationwide in the next three years alone.

“These figures show how important the brewing and pub sector is in the North West. I hope you will take action to protect these jobs by scrapping the beer duty escalator. This will also help our much-loved pubs, the communities they serve and the important local facilities they provide. The Duty system should be rebalanced to encourage the consumption of low-strength alcohol.
“I am aware that you are very busy in the run up to the Budget, but due to the potentially significant impact these tax changes will have to pubs in my region, (and yours) I would be extremely grateful if you could inform me of how the Treasury plans to deliver on the Prime Minister’s ambition to be a pub-friendly Government.”

They have signed an Early Day Motion (EDM) put forward from Andrew Griffiths MP and chairman of the All-Party Parliamentary Beer Group, that said the move would “help reduce pub closures, create 5,000 additional jobs and ensure pub going remains an affordable leisure activity”.

The EDM states that beer and pubs contribute £21bn to the UK’s GDP and support almost 1m jobs.
“2012, as a year of national celebrations, is the perfect time to recognise the economic and social value of great British beer and the pub industry,” the EDM says.

The motion was supported by MP Greg Mulholland, chairman of the All-Party Save the Pub Group.

The EDM in Parliament with the most MPs signatures at 275 is one tabled by Mulholland in June 2010, which calls for the House of recognise the social, economic and cultural importance of well-run community pubs.

With 95 percent of the UK population living within ten miles of the confirmed route, several local authorities are planning events to coincide with the torch’s arrival in their region.

With overnight stops planned in certain locations, licensees have been advised by the Association for Multiple Licensed Retailers to begin preparing now if they want to be involved in these popular occasions.

Clare Eames, partner at licensing lawyer Poppleston Allen commented:

‘If you want to take advantage of the wave of enthusiasm that the Olympics will undoubtedly generate, you need to act now.

‘The torch relay will provide real opportunities for operators across the UK – jump on the bandwagon now if you want to boost your trade.’

News of another campaign to tie in with the Olympics was also unveiled by culture secretary Jeremy Hunt and VisitEngland. The ‘20.12% campaign’ is a discount scheme to boost tourism around Olympic time by offering discounts on services such as food, drink and accommodation, with many licensed businesses being encouraged to sign up.

Since the relevant law was introduced at the start of October, almost 80 percent of the 300 members surveyed said they hadn’t seen the unpopular measures for sale in pubs.

However, 45 percent of members said they did want landlords to offer the controversial  measure, with many theorising that it would encourage more customers to try new and different real ales.

CAMRA head of public affairs, Jonathan Mail, commented:

‘It appears British beer drinkers remain in two minds about this new two-thirds pint measure, and this uncertainty is reflected by publicans, very few of whom have taken on the new glassware since the beginning of October.’

Speaking to the Publican’s Morning Advertiser, Andy Wilkinson – boss of Clover Taverns – detailed some of the ways that wholesale food price rises were set to affect pubs, quoting increases such as up to 11 percent on frozen vegetables, 7 percent on chips and as much as 20 percent on other menu staples.

The price hikes haven’t been felt to quite the same extent by the UK pub food market’s largest buyer, Mitchells & Butlers, as highlighted by finance director Tim Jones in their most recent trading update.

‘Our experience of food cost inflation is running at about four percent. We think that’s some way below what the market is.’

Various measures have been adopted by different food-led pub operators to counter the developments, such as Innventure’s tactics of using vacuum-packed meat for more slow-cooked dishes, or bavette cuts of beef instead of rump steaks, keeping menu costs lower.

According to analyst Peter Backman, of Horizons, operators are selecting alternative products, such as beef instead of lamb, in an attempt to limit food inflation costs to around six percent, industry-wide. HE commented:

‘The question here is having a perspective on how much things cost. Sure, some items are rising so you have to cut your costs, but the point is not to cut quality.’

As part of a drive to ensure the regulations are properly applied within UK business, stocktakers will no longer be required to register with HMRC, a move that also supports the Government’s policy of reducing regulatory burdens on businesses.

Any stocktakers that do offer bookkeeping or accountancy services are to remain on HMRC’s register and all stocktaking professionals – regardless of their status – have been urged to remain vigilant and report suspicious activity to the Serious Organised Crime Agency (SOCA).

For further information, please visit soca.gov.uk.