Business rates a ticking time bomb for pubs and shops
Retailers and the hospitality sector seem to be mobilising the troops with dire warnings coming out that thousands of business are at risk if the business rates holiday isn’t extended beyond April 2021.
The British Beer & Pub Association (BBPA) say thousands of pubs across the UK could be forced to call time as they face an £800 million business rates bill come the end of March – an average of £25,000 per hostelry.
(BBPA) believes the business rates could be “the last straw” for many and force them to close for good. It is asking that the Government now extend the pub sector relief for at least another 12 months. The UK beer and pub sector employs around 900,000 people, including 600,000 workers who are directly employed in pubs.
BBPA chief executive Emma McClarkin said: “Given that all these pubs made it through the lockdown – over 15 weeks without being able to open their doors – and have remained viable businesses despite social distancing and significantly lower footfall, it would be devastating for them to fall at the final hurdle in the post-lockdown recovery.
“It would mean much of the Government’s vital support for the sector through lockdown would have been wasted.”
In response to the BBPA’s call, a Treasury spokesman outlined the various schemes currently ongoing that have supported the sector including a business rates’ holiday and cash grants of up to £25,000. The Eat Out to Help Out initiative was also seen as a huge success throughout August alongside the ongoing VAT reduction, until January 2021. The spokesperson, however, didn’t address the BBPA’s specific warnings or its request for extending the business rates’ holiday.
There are also reports doing the rounds that the Treasury is holding talks with retail leaders to discuss the future of the high street and possible further government action. A coalition of retailers has told the Treasury that reinstating business rates in full next April would make 800 stores unviable and risk 10,000 jobs.
The Valuation Tribunal has ruled in favour of Voodoo Doll Ltd following an appeal over the valuation method used on the Mojo bar and restaurant in Manchester.
A Tory MP is calling for business rates to be scrapped and replaced by an increase in VAT in order to save high street businesses.
Maximising income and protecting cash flow has never been more important for landlords as the UK battles through the latest stage of the pandemic.