Pub body calls for beer duty cut amid potential outdoor smoking ban

A body representing British pubs has called for a raft of tax cuts ahead of the October Budget, following recent reports suggesting the Government could ban smoking in beer gardens.

The British Beer and Pubs Association, which does not represent pubs in Scotland, said it wants a cut to beer duty.

It added that pubs currently make an average of 12p profit on every pint of beer once taxes and costs have been deducted.

It comes alongside fresh research by Oxford Economics, a think tank, which suggests pubs contributed £34.4bn to the economy in 2022, the most recent year on record, and £17.4bn in tax.

But Emma McClarkin, chief executive of the BBPA, said the sector is “shouldering multiple taxes and costs that are squashing growth and could lead to businesses failing”.

She said: “There is no more meat on the bone to cut, which is why we are calling on the Government reduce the cost of doing business so we can continue to make a massive contribution to the public purse.”

Pubs and restaurants took a hit during 2020 and 2021, closing for months at a time during Covid-19 lockdowns.

Then, through 2022 and 2023, skyrocketing inflation caused their operating costs to rise, while the cost-of-living crisis depressed sales.

The number of pub closures increased to 80 per month over the first three months of 2024, up by 51% compared with the same period last year, according to official Government data for England and Wales.

In August, Sir Keir Starmer said the Government would “take decisions” on a potential outdoor smoking ban in an effort to curb preventable deaths and alleviate pressures on the NHS.

Industry leaders have warned that the proposed plans to ban outdoor smoking, including in beer gardens and outside stadiums, would be another “nail in the coffin” for pubs and bars.

According to leaked proposals seen by The Sun newspaper, the indoor smoking ban could be extended to cover other locations including small parks, outdoor restaurants and hospitals.

One of the BBPA’s suggestions to counter the impact on pubs is to reform business rates, something which Labour included in its pre-election manifesto.

The tax – which applies to non-residential property such as pubs, factories, shops and offices – has been criticised for unfairly punishing companies that trade in-person versus online.

Pubs currently enjoy 75% relief from business rates, but Ms McClarkin said it is “imperative” the system is reformed altogether.