Gloucestershire pub landlords call for tax increase reverse

Pub landlords are urging the government to avoid “sticking plaster” solutions in the battle over business rates.

The government has announced plans to scale back the proposed business rate increases revealed in November’s budget, but many landlords at a meeting in the Forest of Dean, Gloucestershire, have said they need more.

“You can’t put a sticking plaster on this. We don’t want a discount, we need it gone and a fair system,” said Phil Kiernan, owner of the Farmer’s Boy Inn in Longhope, whose rates are forecast to double.

“There are three pubs a day closing across the UK and there’s not going to be any stop to it,” said Wayne Childs, landlord at the King’s Arms in Newent.

Every business at the meeting was facing increases under the current proposals, some by tens of thousands of pounds.

Naturally, this is forcing many to consider making significant cutbacks and their entire futures in the industry.

“I’ve spoken to a lot of people today who aren’t even paying themselves minimum wage,” said Nicki Bird, chair of the Forest of Dean Economic Partnership.

“They do it because it’s a passion of theirs and it’s going to be really sad if we see them go just because they can’t afford it,” she added.

“We are already looking at reducing labour and possibly redundancies, which we want to stay away from, but it will be crippling,” said Wayne Edge, landlord of the Yew Tree in Longhope, where his rates are going up by £1,200 a month.

In November’s budget, Chancellor Rachel Reeves announced cuts to business rate discounts that had been in place since the pandemic, and adjustments to rateable values for pub premises.

Business rates are calculated by combining the rateable value of a business with a percentage ‘multiplier’.

Under the proposals originally made in November’s budget, pubs would have seen the multiplier that they would be charged on their rateable value reduced from around 50% to just under 40%.

But at the same time rateable values were increased – often doubling. For many this was much bigger than any reductions in the rate of tax.

The government has now signalled that it could backtrack on this in the face of a widespread backlash, and will instead ask for smaller increases.

I have never met so many angry landlords.

I knew Phil Kiernan was fed up with the business rate hikes. But when he called a meeting, he had 40 other local hospitality firms turn up. At 07:30 in the morning.

The same is happening across the West – in fact across the UK.

So what do landlords want?

The 40% business rate cut from Covid-19 days is ending. No-one thinks the virus is still here, but they could use a similar discount.

Ministers have trimmed the actual tax rate pubs face, the so-called ‘multiplier’ in the complex calculation of business rates. They could cut that further.

But the real fury is over the business rate calculations. So many pubs have seen their ‘rateable value’ doubled or more.

Can ministers review how this is worked out? Could the whole system be reformed?

One thing is sure. Pub landlords are angry, and now they are getting organised.