Pub owners in Somerset are expressing grave concerns over potential closures as a significant increase in business rates threatens their viability. Following the Autumn Budget, many anticipate a substantial hike in their bills, with some facing a tripling of their current rates, leading to fears for the future of the high street.
Key takeaways
- Pub owners anticipate a sharp rise in business rates, potentially tripling bills.
- The increase is attributed to recalculated rates and the phasing out of Covid-19 relief schemes.
- Business groups warn of widespread closures if the government does not intervene.
- The government states it is providing significant support to the hospitality sector.
The financial strain on publicans
Millie Coward, who owns four pubs in Somerset, revealed that the business rates for one of her establishments, The Bear Inn in Wiveliscombe, are projected to increase by £24,000 annually. This equates to an additional £500 per week, a sum she states is unmanageable. "We just can’t do that," she asserted, highlighting the already stretched financial limits of the hospitality sector due to rising taxation, increased minimum wages, and the inability to pass on all costs to customers.
Ms Coward warned that without government reconsideration of its plans, "there won’t be a high street left." She has informed customers of potential changes needed to keep the pubs operational, aiming to avoid general price increases.
Wider economic impact and calls for reform
Colin Barrell from the Taunton Chamber of Commerce echoed these concerns, describing the increases as "phenomenal." He noted that pubs are already grappling with rising costs for national insurance, minimum wage, food, and utilities. "So those that are on the edge won’t be able to sustain that and undoubtedly will close," he stated.
Mr Barrell’s own business, Mr Miles Tea Rooms in Taunton, is set to see a 26 per cent increase in its rates. The Taunton Chamber of Commerce is urging the government to listen to the sector, revise its policies, and reform the business rates system.
Government’s response and support measures
A spokesperson for HM Treasury stated that the government is supporting pubs, restaurants, and cafés through a £4.3 billion package. They explained that without this support, pubs would face a 45 per cent increase in their total bills, but with the measures in place, this is reduced to approximately four per cent. The government also highlighted that most businesses facing rate increases will see their bills capped at around 15 per cent next year to ease the transition. Additional support for the hospitality sector includes relaxed licensing for outdoor trading and events, capped Corporation Tax, and a continued cut to alcohol duty.
