Norwich pubs facing new beer tax threat
PUBLISHED: 10:56 21 March 2011 | UPDATED: 17:49 21 March 2011
Archant Â© 2011
Locals could see their favourite Norwich pubs close if a 7pc rise in beer duty takes effect in this week’s Budget.
That is the fear felt by the British Beer and Pub Association (BBPA) which is trying to persuade the government to scrap the tax hike by showing the vital role the industry plays across the country.
In a BBPA report seen by the Evening News, it was revealed that Norfolk pubs employ more than 12,000 people and contribute £256m to the county’s economy every year – £14.3m more than neighbouring county Suffolk.
But these numbers could decline due to an increase in the price of beer caused by the beer duty escalator, which is set for a 2pc rise above inflation.
Today, landlords in Norwich spoke of the damaging effect the rise could have on the city, which they say would put jobs at risk, prevent economic growth and encourage more people to buy cheap supermarket alcohol and drink at home.
One Norwich landlord believes the government should not increase beer tax, but reduce it if they want to see an improvement in the economy.
Phil Cutter of The Murderers pub on Timberhill, said: “There is a massive deficit in the economy that needs to be budgeted, but it’s not going to be fixed by putting a tax on the pubs.
“In France, they reduced the taxation on the leisure industry and it helped the economy.
“We need to drive people back into pubs by keeping the costs down and that way we will start to see more money being driven back into the economy.”
“I believe the government needs to focus less on the pubs and more on the supermarkets which are selling beer at pocket-money prices. That is where they need to look if they want to claw back the money.”
A rise in beer duty in Wednesday’s Budget would add 3.5 pence to the average pint and create another expense to the pub and brewery trade, which is still recovering after a 2.5pc rise in VAT this year.
The BBPA has urged the government to abandon the tax hike and instead look to the brewery and pub trade in counties like Norfolk to help lead the country out of recession.
Figures released by the association revealed that a total of 814 Norfolk pubs contributed more money to the economy than many counties in England.
Currently, our pubs provide £59m more than Cumbria and £26.9m more than Lincolnshire – despite both areas having more than 800 pubs.
The landlord of the Trafford Arms on Grove Road believes that a rise in beer duty would cause this trade to suffer and could lead to pub closures and job loses across the city.
Chris Higgins, who has been landlord at the pub for more than 20 years, said: “The government wants to help the economy, but an increase in beer prices is not going to do that if it’s going to put jobs in pubs at risk.
“If the government is serious about looking at getting people back to work then it should help pubs to keep people in employment.
“I think the government fails to realise what the pubs provide people. If you take away the small pleasures pubs offer on any given evening then you end up with a situation where people do not have a place to socialise any more.”
Scrapping plans for an above inflation duty increase would save more than 10,000 jobs, while a freeze on duty would generate £40m in extra tax revenues, according to an Oxford Economics report.
James Linder, owner of the Garden House pub, Pembroke Road, would welcome the move, but fears that it may be too late to stop the ever-increasing price of beer.
Mr Linder said: “The fear used to be that one day we would see the £4 pint, but now it is no longer a worry – it is going to happen.
“Our turnover is higher than it was last year, but our profit is lower because of the increase in VAT and business rates, as well as all the other costs such as insurance and utilities.
“I personally believe that the government is trying to force people to drink in their homes and force them off the streets, but we are the key to better and safer drinking because we provide responsible retailing.”
The Evening News has been urging people to return to pubs through our Love your Local campaign. To see more stories from the campaign visit www.eveningnews24.co.uk/loveyourlocal
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