Taxation on pubs has gone too far, says Wetherspoon

13th March 2009, 11:04am

JD Wetherspoon's chairman Tim Martin has slammed the government for not fully comprehending the effect its decisions has on pubs, calling hikes in beer tax 'a step too far'.

"The government seems not to understand the economic impact of new taxes and legislation and continues to impose new burdens at a huge rate. In order for the pub industry to prosper, taxes and social legislation imposed on businesses need to be reduced or to stay at current levels for a considerable number of years," said Martin, who added that the tax hikes will cost JD Wetherspoon £15 million in this financial year.

Martin's comments come as the pub company posted an increase of 2% for like-for-like sales and total sales surpassing the £468 million mark. The figures relate to the six month period ending 25th January 2009.

Martin described tax hikes as 'opportunistic' and said that their only purpose is to 'curry favour' with voters, ignoring the needs of businesses.

"Even the closure of one small pub results in a far greater loss of revenue to the government than it does to the publican or pub owner. Costs of taxes and regulations have gone too far and Britain has now become a highly taxed economy, with high and increasing employment costs, which will have predictable and inevitable effects on employment levels and tax income in the near and medium term," commented Martin.

Today's profits show that Wetherspoon's recent 99p pint deal and £2.99 meal deals increased footfall and customer spend.

Binge drinking, the cause of which is often blamed on pub chains like JD Wetherspoon, is a cultural issue and should be addressed on that basis, according to Martin. "There is a genuine problem relating to binge drinking but attempts to crack down on pubs serving under 18 year olds are putting a huge and unjustified pressure on pubs, the police and other authorities, while exacerbating the underlying issues."

JD Wetherspoon opened 21 new pubs during the six months ending 25th January and the pub company said it closed one site.

Martin concluded with a positive note about the business' prospects: "Although the pub industry as a whole is under great pressure from higher taxes and social legislation, as well as a difficult economy, as a result of our strong cashflow, reducing debt and the excellent work of our employees, I remain confident of the Company's future prospects."

Related Articles:

• 01 Jun 2009 - New figures show UK near top of EU beer tax league
• 13 May 2009 - MPs call for inquiry into 'beer tie' activity
• 13 May 2009 - JD Wetherspoon gets saucy with Levi Roots
• 06 May 2009 - JD Wetherspoon announces positive trading
• 01 May 2009 - Wetherspoon only pub listed in Britain's Top Employers
• 28 Apr 2009 - Beer sales continue to slide
• 20 Apr 2009 - 90% of public want taxes reduced or frozen in Budget
• 13 Apr 2009 - 'We will not punish those who drink responsibly'
• 08 Apr 2009 - Tax rises will result in pub job losses
• 03 Apr 2009 - Over 1,130 pubs owned by pubcos have closed
• 18 Mar 2009 - New figures show 3.2% fall in alcohol consumption
• 17 Mar 2009 - Drinks industry leaders meet with the Chancellor
• 16 Mar 2009 - Minimum alcohol price plans to be unveiled
• 12 Mar 2009 - 30,000 people support local pubs
• 04 Mar 2009 - Record number of pubs closing
• 02 Mar 2009 - New poll shows public are backing local pubs
• 26 Feb 2009 - Tories want to save the great British pub
• 10 Feb 2009 - Over 100 MPs back the great British pub

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