HGV crisis: 'Unreasonable' to blame Brexit says Rishi Sunak
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More than 80 percent of pubs have already hiked their prices or are planning to, according to a poll by the Morning Advertiser, a UK pub trade publication. This is even before the Chancellor announces any duty in his Autumn Budget next week. From the 189 respondents, the poll found that just less than a fifth (19 percent) are not willing to increase their prices.
The potential rise in prices has been driven by a shortage of hospitality staff returning after a prolonged period of furlough which has opened up around 134,000 vacancies in the sector.
Now publicans are appealing to Mr Sunak to freeze alcohol duty rate amid fears the public may regularly have to pay £6 for a pint across large areas of London and the South East.
Drinks wholesaler Matthew Clark and Bibendum, which supplies thousands of alcohol products, has already said it will be increasing prices by 3.5 percent from next month.
The businesses, owned by C&C Group, have put the increase down to supply chain pressures sweeping through the country, as well as a hike in labour costs and fuel prices.
A company spokesman told the Morning Advertiser: “As our industry recovers from the pandemic, the resulting, well-documented pressure on UK and global supply chains has added increased costs and complexity.
“This has been further compounded by increased labour costs and fuel price inflation.
“While we work hard to mitigate the impact of these pressures, in order to be able to maintain the service we provide our customers, we have had to take the decision to increase prices of our products.”
Dave Mountford, co-founder of the Forum of British Pubs, believes pub owners will have to increase pint prices from 20p to 30p to meet rising costs.
The Derby publican told The Times: “In my pub that means I will be charging more than £4 for a pint of cask ale for the first time.
“It will mean much more in areas like London.”
Emma McClarkin, chief executive of the British Beer and Pub Association, has appealed to Mr Sunak to “support the sector” by cutting beer duty, VAT and business rates in next week’s Budget.
She told Sky News: “Our sector faces a range of cost pressures and rising prices at a critical time in our recovery.
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“It is one of the reasons we are urging the chancellor to support our sector by cutting Beer Duty, VAT and Business Rates in the Budget next week to ensure our pubs and brewers can remain at the heart of communities up and down the country.”
Ed Bedington, editor of the Morning Advertiser, wrote in his publication: “Price rises are rapidly becoming a major reality for operators that are already facing increases on a number of fronts, from the rise in the national living wage through to the increases in VAT and the threat of a return to the full horror that is business rates.
“We’re facing a tsunami of increases on the horizon and it’s going to be a real challenge for all.”
Last week, a leading financial think tank urged the Chancellor to freeze taxes on fuel and alcohol in the upcoming Spending Review to ease the cost of living crisis.
Tom Clougherty, head of tax at the Centre for Policy Studies, said: “There is a strong case for freezing fuel and alcohol duties for a further tax year at the forthcoming Budget.
“Inflation and already-announced tax and benefit changes are putting pressure on household budgets.
“Our existing excise duties are high compared with our neighbours and as a proportion of final sale prices.
“What’s more, both alcohol and fuel duties are outdated in their current form and in need of a serious overhaul – a process that is already underway for alcohol.
“He Chancellor froze alcohol and fuel duties at his March 2021 Budget. He should do the same again in a few weeks’ time.”
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