Wetherspoon boss backs 10% VAT rate for UK pubs

JD Wetherspoon chairman Tim Martin has urged the wider hospitality industry in a statement to support a political proposal to reduce VAT to 10%, in a bid to achieve supermarket tax parity. 

The plan includes further cuts to excise duty and business rates to help pubs recover trade lost to off-license retailers since the early 2000s.

Martin cited data from Morgan Stanley that suggests pubs have lost 50% of their beer volume to supermarkets since the millennium due to a widening tax differential.

According to Martin, the proposed reductions in VAT would allow pubs to sell pints for £2.99 while increasing current gross profit margins.

News of Martin’s support for this VAT reduction follows his previous criticism of the British Beer and Pub Association (BBPA) and London-based financial advisory Langton Capital for what he described as an underwhelming response to the tax reform initiative.

Historical data from Cardinal Research in 2013 also found 96% of licensees supported VAT reductions, despite opposition from some large pub company executives at the time.

Family brewers including Fuller’s and Shepherd Neame have previously supported tax equality campaigns to protect the long-term viability of the hospitality sector.

Tim Martin said: “If you do believe in tax equality, then you’d better support it, because the supermarket industry has nicked half your trade in recent years – and it will gobble up most of the rest in no time flat.”