What are the key changes affecting the nightlife and hospitality industries?
Yesterday, Chancellor Rishi Sunak delivered his autumn 2021 budget in a speech in the commons, setting out changes to a variety of sectors, with a vision for a new economy post COVID.
Living Large
Most significantly, the living wage will be £9.50 an hour, which will produce a raise for those workers of £1,000 a year according to Sunak.
According to Paul Johnson of the Institute of Fiscal Studies, this will amount to around £700 after taxes for most individuals, being even less for those on Universal Credit.
Banking on Beer
Next, Sunak was quoted as saying he wants to support “the home of British community life for centuries”, meaning pubs. He acknowledged that the industry was struggling before the pandemic, but that many public health bodies recognise them as safer drinking environments than being at home.
He then announced a “draught relief” to help the industry bounce back from the hardships of the pandemic, with a 5% cut to duty on draught beer and cider served from draught containers over 40 litres.
The cut is a landmark moment for the industry, which is well deserved after a tumultuous 22 months. According to Sunak, it is “the biggest cut to cider duty since 1923 [..] the biggest cut to fruit ciders in a generation [..] and the biggest cut to beer duty for 50 years.”
The move is also set to be a “long-term investment in British pubs of £100m a year”
(although no mention of the logistics of this), and a permanent cut in the cost of a pint by 3p”.
Rishi Sunak goes on to say that the UK will carry out the “most radical simplification of alcohol duty” for over 100 years.
He says there will be just six duty rates on alcohol, in which the stronger the drink, the higher the rate.
He says although some stronger spirits and wines will become more expensive, weaker alcohols like beer and rosé will become cheaper.
There will also be a new “small producer relief” which will include small cider makers for the first time, in a similar way to small brewers’ relief.
Duty is also being cut on fruit ciders to bring it in line with apple ciders, he states.
Heart for Hospitality
Sunak starts by stating that he wants to “help those businesses hardest hit by the pandemic”, and confirms a new 50% business rates discount for companies in retail, hospitality, and leisure sectors, lasting for one year.
This includes “pubs, music venues, cinemas, restaurants, hotels, theatres [and] gyms”, which will be able to claim a discount on their bills of 50% up to a maximum of £110,00.
Sunak claims that this means “more than 90% of all retail, hospitality and leisure businesses will see a discount of at least 50%.” He further claims that this is “the biggest single-year cut to business rates in 30 years.”
