Slashing tax on foods and non-alcoholic drinks will disproportionately affect pubs not serving food an MP warns

AN MP fears plans to slash tax on foods and non-alcoholic drinks will disproportionately affect pubs not serving food – in turn damaging trade further.

Shipley MP Philip Davies said many pubs across the constituency only served drinks and therefore would not benefit from Chancellor Rishi Sunak’s six-month VAT reduction.

He said: “Pubs are the cornerstone of the local community and we must do everything practically possible to support them. I was delighted Rishi announced help for restaurants, cafes, hotels and other venues through a tax reduction on food, accommodation and attractions but this means some pubs miss out.

“It is widely known pubs up and down the country were struggling before the pandemic so the last thing we want to do is see any more shut. I am concerned about this and have had conversations with landlords and licensees in recent days and I will be making these views known to ministerial colleagues in the Treasury.”

Last week as well as announcing a temporary cut in VAT to 15 per cent from 20 per cent, Mr Sunak confirmed Government will fund a 50 per cent discount on meals at participating venues on certain days throughout August. 

Mr Davies added: “Pubs and restaurants have said profits and takings will be down because of social distancing and not being able to accommodate so many customers.  But for those that only serve drinks they now face another disadvantage in already extremely difficult times when they are trying to pay bills and keep their staff on.

“The tax cut only applies to non-alcoholic drinks but I know some businesses are concerned there will be places that slash the price of drinks by putting offers on and maintain food prices, as for August at least they will be claiming money back from Government for the food offer. As we emerge from lockdown and can enjoy going to the pub once more it feels bittersweet for some who have waited so long only to be dealt another blow.”