Bars, clubs and other businesses will be put at risk after a London council backed the introduction of a late-night levy, trade bodies have warned.
After plans to introduce the charge were postponed back in May, Tower Hamlets Borough Council has now agreed it will be imposed on businesses open from midnight to 6am from January 1 next year.
The levy will affect bars, pubs, clubs and restaurants in a wide area of east London including Docklands, Spitalfields, Bethnal Green and Brick Lane (pictured), many of which are thriving parts of the capital’s late-night economy.
The fee will range from £299 per year to £4,440, based on rateable value, which will be equivalent to £5.75 and £85.38 per week.
Kate Nicholls, chief executive of the Association of Licensed Multiple Retailers (ALMR), said: “Obviously, this is a very disappointing decision from Tower Hamlets council, one which will put further financial pressure on valuable businesses in the area. The levy will stifle investment, put jobs at risk and could ultimately see venues close.
“The decision is even more disappointing given the House of Lords committee reviewing the Licensing Act acknowledged that the levy is unfit for purpose and recommended that it be abandoned altogether.
“The ALMR’s submission to the council clearly highlighted the dangers of introducing a levy and was supported by a petition from local venues opposed to the measure.
“It is very disappointing to see the council ignoring the concerns of its own businesses in favour of a measure that will put the area’s late-night offering at risk and, in all likelihood, have no appreciable positive impact.”
Brigid Simmonds, chief executive of the British Beer and Pub Association (BBPA), commented: “This is very disappointing and will damage the economy of a vibrant, inner London borough with a beer and pub sector that employs over 2,800 people – a point we had made very clear to the council on two occasions.
“Other authorities have turned away from a levy, and a recent House of Lords report has concluded that the late-night levy has ‘failed to reach its objectives and should be abolished’.
“When it comes to addressing any issues in the night-time economy, there are far better solutions than this punishing new tax on local business, such as Business Improvement Districts.”
John Biggs, mayor of Tower Hamlets, said: “The borough has a vibrant night-time economy which we want to support. The late-night levy is a way to ensure a financial contribution from businesses that sell alcohol between midnight and 6am is ring-fenced for this purpose.
“This will ensure as a council we can then tackle anti-social behaviour through the work of our anti-social behaviour officers and police to reduce alcohol-related crime. We are keen to hear from businesses and residents about our proposals.”
Cllr Asma Begum, cabinet member for community safety, added: “The night-time economy is a vital part of Tower Hamlets but premises serving late into the night can also incur extra costs for our borough, such as anti-social behaviour. By introducing a late-night levy we can ask these businesses to pay a fair share of the costs.”