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Pubs close at a rate of up to 52 a week

publication date: Jul 28, 2009
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A record 52 pubs a week are now closing in Britain, leading to the loss of 24,000 jobs in the last year, according to new figures compiled by CGA Strategy, released by the British Beer & Pub Association (BBPA).
The figures for the first six months of 2009 show the rate of pub closure has increased by a third, up from 39 pubs a week in the last six months of 2008. Over the last 12 months, 2,377 pubs have closed, costing 24,000 jobs. In the last 3 years a total of 5,134 pubs have closed. There are now 53,466 pubs in Britain, down from 58,600 in the year before the Licensing Act came into force.

Despite these closures and big pressures, such as additional regulation costs, the industry is also facing a double whammy on beer tax over the next few months - with the planned VAT increase in January and a further 2 per cent above inflation rise in duty in March under the Government's beer tax escalator.
“The recession is proving extremely tough for Britain’s pubs,” said BBPA chief executive David Long. “However, those economic pressures have been made much worse by a Government that has continued to pile on tax and regulatory burdens. The last two Budgets have seen a 20 per cent increase in beer tax, which alone has added more than £600 million to our tax bill. In addition, Government continue to press ahead with the Mandatory Code of Practice, which they say heap at least £30 million of extra red tape cost on pubs in the first year alone.

“While every other sector seems to receive a sympathetic ear and a tax payer funded handout from Government to tide them through the downturn, all we are getting is a deaf ear and a higher tax bill.”

The BBPA figures show pub closure is reducing Government tax revenues. The industry’s total tax bill now stands at £6.1 billion a year. Every pub contributes £107,000 in tax a year – 30 per cent of turnover. Pub closures over the last year have therefore cost the Government more than £254 million in lost taxes – a loss that is increasing by more than £5.5 million a week. Sector job losses are also costing the Government an additional £1.53 million a week in job seekers allowance.