Immediate reactions to the Autumn Statement from the BBPA and ALMR are mixed.
BBPA Chief Executive Brigid Simmonds comments:
“The extension of Small Business Rate Relief for another year is welcome, and is worth £25 million, and is something we had specifically requested. One third of pubs will qualify, 15,000 premises, in total.
“However, it is very disappointing that the Chancellor has not extended retail relief for a further year – this is effectively a £1,500 tax increase for the majority of pubs, and will add £46 million to pubs’ rates bills.
“Retail relief was providing a discount for pubs with a rateable value of £50k or less, which is 75 per cent of all pubs. This is a particular problem in the run-up to the revaluation in 2017 as rates bills have become out of kilter with the value of individual businesses.
“Britain’s pubs face a total tax bill of £7.3 billion per year, so we will be keeping up the pressure for further measures, such as more action on both beer duty and business rates, as we move towards the Budget in March.
“I do welcome the announcement that small businesses like pubs will typically not be burdened with the Apprenticeship Levy, as this would have placed an excessive burden on what are mostly small businesses. It is crucial that the Levy system is straightforward and allows those that pay into the Levy fund to access their full contribution to support apprenticeships.”
Government needs to deliver on business rates reform
The ALMR welcomed the extension of business rates relief for another year, but reminded the Government of the need to implement a root and branch reform to bring about a fairer deal for licensed hospitality businesses.
It has also sounded a note of warning over the introduction of an Apprenticeship Levy and warned that additional costs burdens are likely to affect existing training budgets. The ALMR has also welcomed the decision not to cut police budgets.
ALMR Chief Executive Kate Nicholls said: “The extension of the small business rate relief for another year is certainly welcome as this is something the ALMR has consistently pushed for. It is disappointing, however, to see that once again we are in a position of urging the Government to hasten with real and meaningful change to the business rates system and to bring about root and branch reform.
“This is increasingly a system that sees business relying on multiple discounts and allowances and is a recipe for confusion or avoidance, something the Treasury has already highlighted. The licensed hospitality sector is carrying an enormous burden in the shape of business rates, with pubs accounting for 2.8% of all UK tax receipts; a situation that is plainly unfair and unsustainable for some businesses. The Chancellor indicated that the review of business rates will report at next year’s Budget Statement and we are hopeful that it will bring with it good news for the sector.”
Apprenticeship Levy and impact of National Living Wage
Martin Couchman OBE Deputy Chief Executive British Hospitality Association said: “We are pleased that 98 per cent of businesses will not be paying the apprenticeship levy because of the £15,000 payroll threshold announced in the Autumn Statement.
“We await details of how smaller businesses will be supported in training apprentices. We are pleased to see that a new employer led body will set apprenticeship standards and ensure quality, but note that the hospitality industry has already made a lot of progress in developing apprenticeship standards.”
“The introduction of the NLW from April 2016 will have a major impact on hospitality businesses’ finances so we are pleased to see a slight softening of costs through the decision to delay increases in auto enrolment pension contributions by 6 months from autumn 2017 and again in autumn 2018.”