December 6 2013 Latest news:
Saturday, September 14, 2013
Wetherspoon pubs across the region are among those set to cut the price of all food and drink by 7.5pc on Wednesday, September 25 as part of an ongoing campaign to cut VAT in the hospitality industry.
Currently all food and drink in pubs is subject to a 20pc VAT rate in contrast to supermarkets where there is no levy.
Chairman Tim Martin, who has long campaigned for the cut, said the aim was to show the benefits to the industry of a 5pc rate.
He said: “A reduction in the level of VAT on a long-term basis will generate growth and create jobs in the important leisure and hospitality sector. Creating tax parity between pubs, restaurants and supermarkets will fulfil many government objectives.
“It will create more jobs and it will raise the amount of taxes the government receive, since pubs and restaurants pay more taxes and create more jobs than supermarkets. It’s a win-win situation for the government, voters and our industry.”
James Kelly, manager at the Bell Hotel in Norwich, said: “We are keen to highlight the amount customers would save if VAT in pubs was lowered permanently. So, for example, the total price of a meal and drinks for a customer would be reduced from £10 to £9.25 on Tax Parity Day.”
The move comes as Wetherspoon notched up another year of record profits and sales but said it does not expect much help from the economy as customers remain under pressure.
Mr Martin said while Britain has narrowly avoided economic “Armageddon”, it will be a “long, slow haul” to recovery, giving little cause for celebration to its cautious punters.
The chain of almost 900 pubs said growth is likely to remain subdued for the year ahead, after a recent slowdown in like-for-like sales growth to 2.5pc in the two weeks to September 8, as it comes up against strong numbers a year earlier.
Underlying sales grew 5.8pc in the 52 weeks to the end of July, with a 10.9pc surge in like-for-like food sales after the chain overhauled menus in its increasingly food-led pubs.
Record sales of traditional ales and ciders helped bar takings grow 3.8pc during the year.
Revenues grew 7pc to £1.28bn during the 52 weeks, compared with a 53-week financial year in 2012.
Profits before tax and exceptional items were 6.3pc stronger at £76.9m. But they fell 3pc to £57.1m once exceptional items such as impairment and onerous leases were included.
Great Yarmouth MP Brandon Lewis has hailed the town’s growing significance as an energy hub after the arrival of a new offshore business bringing the promise of 100 jobs over the next three years.