Increase in beer duty will lead to more pub closures, warns landlord

An award-winning pub landlord has warned that any increase in beer duties will lead to more closures.

John Ellis, who owns the Crown Inn at Oakengates and the Elephant & Castle in Dawley
John Ellis, who owns the Crown Inn at Oakengates and the Elephant & Castle in Dawley

John Ellis has written to Chancellor Rishi Sunak ahead of his autumn Budget on Wednesday.

He has also contacted Telford MP Lucy Allan, calling for urgent support for struggling pub owners.

Mr Ellis, who owns two pubs in the Telford area, said it had not been viable for him to reopen the Elephant & Castle in Dawley since the end of lockdown, and said the Crown Inn in Oakengates had been operating at reduced hours with a smaller staff.

He warned that rocketing gas and electricity prices and an end to temporary cuts in rates and VAT, was making life extremely difficult for the licensed trade.

Mr Ellis said he, like many landlords, would be waiting nervously to see whether next week’s Budget will ‘level up’ the hospitality industry, or further punish it.

He said he was particularly concerned about the possibility of an increase in beer duties, which were also subject to VAT.

Mr Ellis said this put them at a disadvantage compared to the supermarket trade, which often sold beer as a loss-leader, cross-subsidised by sales of other products.

Rishi Sunak will unveil the Budget next week

“This is not part of the ‘levelling-up’ agenda that we were promised, and an increase in duty will lead to more pub closures,” he said.

Mr Ellis said this would be exacerbated by the fact that many of the Government’s emergency loans to get them through the Covid pandemic would now need to be paid off during the quieter months of the winter.

“Further pub closures will lead to more gaps in high streets and fewer places where people can meet, leading to worsening mental health outcomes and more problems meeting governmental targets and aspirations,” he said.

A spokesman for Ms Allan said she had been in regular contact with Mr Ellis, and met him on December 4 and February 23 this year.

“As a result of lobbying from Lucy, and indeed from many other MPs and lobbyists, the Treasury team are aware of the challenges the pub trade faces and in particular of the issues that Mr Ellis has put forward in his considered and well-argued correspondence,” he said.

“Lucy will ensure a further copy of Mr Ellis’ letter is sent by text to the Chancellor’s parliamentary private secretary by way of reminder.”

Telford MP Lucy Allan

He said the Government had done much to support the hospitality sector, including one-off restart grants of up to £18,000, 66 per cent relief on business rates, and a reduced 12.5 per cent rate on VAT until the end of March next year.

Drink duty had also been frozen until at least March, he added.

Ms Allan added: “Levelling up is about creating opportunities across the country through education, training, skills, and – as we have seen in Telford – significant infrastructure projects which can deliver them.

“I expect the budget to build on the levelling up agenda and re-emphasise the Government’s commitment. Like all MPs I will continue to lobby the Chancellor on behalf of my constituents in the hospitality sector and across the local economy.”

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