The boss of pub giant Wetherspoon has accused the Government of causing “massive” economic damage over the changing restrictions for his industry.
Company chairman Tim Martin called for measures to keep pubs in business as they struggle to cope with the worsening virus crisis.
Leading business groups also stressed the need for new financial support amid warnings firms are facing continued staff shortages and plummeting consumer confidence.
Mr Martin told the PA news agency: “The Government has caused massive and unnecessary economic damage with a constantly changing series of restrictions for pubs which have no medical basis – curfews, a substantial meal with a pint, table service only (unlike shops) and so on.
“If it wants to keep pubs in business – Wetherspoon alone paid one pound in every thousand of tax collected by the Government in 2019 (three quarters of a billion pounds) – it should eliminate VAT on pub food, which it already does for supermarkets, and make that permanent.
“It should also eliminate business rates until Covid restrictions end completely.
“If it does these two things it might preserve one of its biggest sources of employment and tax – namely, pubs.”
Baroness Ruby McGregor-Smith, president of the British Chambers of Commerce, said there has been no news of any financial support to help businesses and others badly affected by the current restrictions.
She said: “With the UK recording its highest ever number of Covid cases in a single day, and this being set to rise further in the coming days and weeks, businesses now face the two-punch combination of serious issues with staff absence and plummeting consumer confidence.
“Until now the Treasury has stepped up at every stage of this crisis to help offset restrictions that limited business’ ability to trade fully, which is what makes its complete absence at this crucial moment all the more baffling.
“Businesses have heard nothing from the Treasury since this new round of Covid interventions arrived over a week ago. Not even a rationale has been provided for why it believes no new support is required.
“Many of these firms, who have survived nearly two years of challenging trading conditions, are now seeing their vital festive income melt away in front of their eyes.”
Rain Newton-Smith, chief economist at the CBI, said: “The onset of Omicron means many businesses seeking to get back on their feet are once again reeling from the virus for a second Christmas in a row. Now the Government must act at speed to prevent the need for further restrictions.
“Implementing Plan B was the right thing to do, but it has dented demand and consumer confidence, and further support for struggling firms will be needed if fresh Government public health measures prevent firms trading their way to recovery.
“Clearer communications must characterise this next phase of living with the virus and its variants.
“The Government’s decision to take swift action in response to the emergence of the Omicron variant was the right one, but the speed of the response gave way to a lack of clarity, leading to greater confusion, uncertainty, and concern.”