I have always wholeheartedly supported our pubs which often play a central role in our communities, especially rural communities, and have done so for centuries. Pubs continue make an important contribution to our culture – fostering a sense of place and community – as well as the UK economy. In recent years, the former Conservative Government took action to protect the nation's hospitality venues, including implementing the Brexit Pubs Guarantee and freezing alcohol duty.
Despite Labour Government MPs standing on a manifesto pledging to avoid raising tax on “working people”, at the Autumn Budget 2024, the Chancellor, Rachel Reeves, announced £40 billion of tax increases, the largest in a generation. These tax rises included imposing a £25 billion tax on working people by increasing employers’ National Insurance.
As a result of this, the tax burden will rise to 38.2 per cent of GDP by 2028-29 - the highest level in the country's history. Indeed, as Kate Nicholls, chief executive of UK Hospitality, said, any rise in National Insurance would “particularly hammer sectors like hospitality, where staffing costs are the biggest business expense".
More widely, I welcome that, from February next year, the Government is cutting alcohol duty on draught products, reducing it by 1 penny per average strength pint. I am, however, disappointed that alcohol duty on non-draught products will increase in line with inflation next year.
I am proud of the former Government's record of supporting pubs and will continue to urge Ministers to address the challenges faced by the hospitality sector.
