THE PUB CHAIN JD Wetherspoon has criticised the tax burden the pub industry bears in its third quarter trading update.
The main targets for its ire were the charges levied on fruit and slot machines, late-night opening hours and VAT, which it says “increases the tax disparity between supermarkets and pubs”.
According to Wetherspoon’s, the levy on fruit machines and late-night levies will cost it £2m apiece in taxes per annum, while excise duty brings that figure up to approximately £11m. The total tax bill the chain will pay for the current financial year is estimated to be around £500m; a £50m increase on the previous financial year.
In a strongly-worded statement, the company claimed “all of the economic benefits of our expansion are currently being levied by the government as taxes”, branding it “an unsustainable situation.”
Wetherspoon’s created some 3,000 jobs over the last financial year.
It added that the current system whereby pubs “pay 20% VAT on food sales while supermarkets pay virtually nothing” is “bad for jobs and for taxes”.
Wetherspoons – along with various other companies in the pub trade including Thwaites, Fuller’s and Shepherd Neame – have set up the ‘VAT Club’ with the aim of persuading the government to reduce tax in their industry. Such measures would generate jobs and better tax takes, it claims.
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