Highlights
- Chancellor expected to unveil £100 m yearly support package for pubs facing financial pressure on Tuesday.
- One pub closed daily in England and Wales last year, with numbers falling from 39,989 to 38,623.
- Pubs face average 76 per cent increase in business rates bills over next three years despite previous relief measures.
Chancellor Rachel Reeves is set to announce a £100 m annual support package for pubs on Tuesday, following concerns over widespread closures and job losses triggered by controversial business rates changes.
The relief measures come after government officials acknowledged they had not fully anticipated the financial impact of the rates shake-up in England and Wales, announced in the budget in late November.
Final details were being finalised on Monday night, with the package expected to be worth approximately £100 million yearly for the pub sector, according to Politico.
The government has also introduced reforms to pub licensing rules, including extended opening hours, though it will not reduce VAT rates on beers, spirits and wine.
Industry challenges persist
Pubs have experienced severe financial pressure in recent years, with substantial cost increases from higher employer national insurance contributions, minimum wage rises, energy costs and inflation.
Analysis of government statistics by tax specialist company Ryan revealed that one pub closed daily in England and Wales last year, with total numbers declining from 39,989 to 38,623, including vacant properties.
Speaking at the World Economic Forum in Davos last week, Reeves acknowledged the sector's unique challenges. "I do recognise the particular challenge that pubs face at the moment and so have been working with the sector over the last few weeks to make sure that the right support is in place," she said.
"I think the situation the pubs face is different from other parts of the hospitality sector."
The chancellor announced a £4.3 bn support package in the budget, including business relief intended to offset the end of a Covid support scheme that had reduced bills by 40 per cent.
However, this has proven insufficient to counter significant property tax bill increases from April's first revaluations since the pandemic.
According to industry body UKHospitality, pubs across the UK face an average 76 per cent increase in business rates bills over the next three years, while hotels are braced for an average 115 per cent rise.
The wider hospitality industry has lobbied for relief, but Reeves confirmed last week the government is focusing exclusively on the pub sector.
