Industry reacts to autumn statement

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Business rates relief, a freeze on beer duty and a lower than expected increase in the National Minimum wage have been announced by chancellor Philip Hammond in his autumn statement today.

The first to react to the news was the Association of Licensed Multiple Retailers (ALMR), which cautiously welcomed news of new business rates relief but reiterated that there is a need for wholesale change to business rates. It also said that whereas the increase in the National Minimum wage was lower than expected, businesses could still struggle to afford it.

“The lowering of transitional relief caps and the increase in rural relief is welcome, but this still falls far short of the wholesale change that many businesses are looking for and that some will need in order to invest and grow,” ALMR chief executive Kate Nicholls said: “The government has indicated that further announcements on rates are to be made by DCLG and we hope that this will provide better news and a more productive step towards tackling rates bills that are a serious difficulty for many businesses.

“The increase to the rate of National living Wage is lower than previously forecasted and will put money back in the pockets of our customers, but will still tighten margins for businesses and some will struggle to afford it,” Kate added. “If wage rates are to be affordable and equitable, the government must step away from a policy-driven rate and ensure that any increases are independently set by the Low Pay Commission reflecting the economic landscape.”

Meanwhile, the Campaign for Real Ale (CAMRA) welcomed the chancellor’s decision not to raise beer duty. Colin Valentine, CAMRA’s national chairman, said: “CAMRA welcomes the chancellor’s decision not to raise beer duty in the autumn statement. Pubs are under a huge amount of financial pressure and with UK beer drinkers paying 52.2p of duty on their pint we are seeing more and more people choosing to drink at home rather than at their local.

“This trend not only hurts UK businesses, but is also contributing to the demise of our communities and affects people’s personal wellbeing. While a freeze in beer duty is welcome, CAMRA would like to see the government do more to reverse the damage done by the beer duty escalator by cutting duty in the 2017 Budget.”

Brigid Simmonds, chief executive of the British Beer & Pub Association, said she understood the need to help people on low pay, but pubs and bars were facing real cost pressures.

“We understand action to help those on low pay, but given the current economic uncertainty there is a real need to look at the cost pressures facing pubs,” she said. “Increases in the National Minimum Wage and Living Wage represent challenges for our sector, particularly in pubs, where labour costs are high, at between 14 and 25 per cent of operating costs.

“The doubling of Rural Rate Relief provides a welcome correction to an anomaly that would have penalised rural pubs, with pubs that qualify now able to claim 100 per cent relief on their business rates through the rural relief scheme.”

She added that while she supports the reduction in the cap on transitional rate relief, the BBPA and other industry bodies had written to the chancellor calling for broader support on business rates, prior to his announcement today. Now, she said the indsutry wants to see enhanced relief for pubs that will be hit hardest by the 2017 revaluation, and an overall review of how rates impact on Britain’s pubs.

“There have been no increases in beer duty rates, which is welcome, but duty accounts for up to 50% of the costs of a UK brewer and remains a concern for the industry,” Brigit added. “Our rate of beer duty in Britain is considerably higher than all other major European brewing nations, and we are now calling on the chancellor to cut beer duty in the 2017 Spring Budget, and tackle the unfair burden it places on Britain’s beer drinkers, publicans and brewers.

For full details of the chancellor’s autumn statement, visit the HM Treasury website.

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