- Posted by: Valerie Vaz MP
- Category: News
Thank you for contacting me about tax on beer and pubs. I appreciate the importance of this issue. Pubs are a vital part of our high streets and social fabric in communities throughout the country and play an important role in our national economy. Yet they have been hit hard, first by COVID-19 and now by the energy and economic crises. Even before the pandemic, they were under severe threat, with a 15% fall in their number from 2010 to 2020. I note the proposed reforms on beer and cider duty, VAT and business rates put forward by organisations such as CAMRA and Long Live the Local. On beer duty, as you will know, the Government has proposed reforms to alcohol duties from 1 August that will reduce rates on draught beer, as well as some lower strength beers. It has also reinstated a previously cancelled freeze in alcohol duty, until new rates are introduced in August. On VAT, the Government has said it has no plans to reintroduce a reduced rate for hospitality.
On business rates, the Government has rejected changes to the tax and the basis of valuation. It has missed an opportunity for fundamental reform – in the long term, we need to scrap the current system and replace it with one that provides a level playing field and takes more of the burden off of small high street businesses such as pubs. I have also supported calls for a cut to business rates for small firms now, paid for by fairly taxing the most profitable global tech companies. More widely, I am concerned that treasured community pubs risk going to the wall because the Government is failing to provide the certainty that businesses need to plan for the future. Its approach to alcohol duty, for example, has seen indecision, U-turns and delays, while on energy bills, it has announced a support scheme that is in my view simply a sticking plaster. We need a long-term plan to deliver lower bills. That is why I support proposals put forward by the Opposition for a £0.7 billion voucher scheme to provide grants for businesses to invest in energy-saving technology this year and keep bills down for small firms.