Chancellor's tax raid spells last orders for rural pubs
Bosses have warned that the Government must intervene to stop smaller taverns, which are vital to rural communities, from being dragged into paying business rates for the first time.
This extra tax burden could be the 'last straw' for many venues and could see villages bereft of their local boozer, said Chris Jowsey, the boss of Admiral Taverns, which runs 1,600 community pubs across the UK.
Meanwhile, TV star and landlord Jeremy Clarkson, pictured inset, told The Mail on Sunday the looming tax raid had left publicans 'like Butch and Sundance at the end of the movie – taking fire from absolutely everywhere'.
Business rates are a levy based on the notional rental value of a commercial property, meaning High Street shops and pubs often pay a premium compared with online giants such as Amazon. But 38 per cent of pubs in England and Wales – or 15,000 venues – currently pay no business rates, as their property values are too low.
However, they could be forced to pay the levy from April 2026, as an upcoming review will see these values reassessed.
This is because the valuations are calculated on a pub's sales, which are likely to have risen as the price of a pint has soared since the last review almost a decade ago. It will pile even more pressure on taverns, which are already struggling with higher energy costs and paying more for staff after Chancellor Rachel Reeves increased the minimum wage and National Insurance Contributions for employers in her Autumn Budget last year.
Jowsey has called on Labour to raise the threshold for business rates, so that properties with an estimated rental value of £17,000 a year would be exempt – up from £12,000 a year, in line with inflation over the past decade. This would protect the most vulnerable venues from being whacked with rates bills, which he estimates could be £6,000 a year for the average tavern.
Jowsey said: 'The Government is sleepwalking into a crisis for England and Wales' much-loved community pubs, as punitive business rate increases threaten their viability. This means many of these pubs will be dragged into paying business rates for the first time, even if their profits are falling.'
He added: 'Unfortunately, this may be the final straw for many hard-working licensees and their pubs, depriving communities of vital social amenities that help overcome loneliness and isolation.'
Jowsey said he was alarmed that despite the looming decimation of Britain's pub sector, he could not 'see anyone in the Government talking about this'.
He is concerned it will accelerate the closure of pubs, which would 'do a lot of damage' to the country's social fabric. He said: 'If Westminster acts, we call on the Welsh Government to follow suit and protect Welsh pubs too.'
An industry forecast last week showed that one pub could close every day this year across Britain. It comes after Britain's hospitality industry was hit by a £500 million-a-year rise in business rates in April alongside a barrage of other costs imposed by Labour.
Before the Budget, small businesses had called for a Covid-era discount of 75 per cent on business rates to be extended to give them breathing space. But the Government cut this to a 40 per cent discount, capped at £110,000 per pub.
Kate Nicholls, the chair of industry group UK Hospitality, said the Government should 'deliver permanently lower business rates' for the sector in this autumn's Budget.
Clarkson highlighted the crisis facing Britain's pub sector in the latest series of his reality show Clarkson's Farm, which chronicled the challenges faced by the former Top Gear host as he tried to reopen a derelict Oxfordshire boozer, which he has dubbed The Farmer's Dog.
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