I would like to start by acknowledging the many great pubs and restaurants in Southend and Leigh. These pubs are essential parts of our community, staffed and managed by hard working people and serving high quality food and drink. I am proud to represent such an entrepreneurial constituency, and will always do what I can to praise the work of constituents and the quality of their services. My key aims for Southend are these: Healthier, Safer, and most relevantly, Wealthier. Allowing businesses to thrive is a key part of this plan, and pubs are certainly no exception.
As many of you may know, under the new alcohol duty system, draught relief provides a 9.2 per cent duty reduction on draught beer and cider products below 8.5 per cent alcohol by volume. I understand the Government is closely monitoring the impact of the recent reforms, including draught relief, and will evaluate the impact of the new rates and structures three years after the changes took effect on 1 August 2023. This will allow time to understand the impacts on the alcohol market, and for HM Revenue and Customs to gather useful and accurate data with which to evaluate the effects of the reform. As with all taxes, the Government keeps the alcohol duty system under review during its yearly Budget process.
Moreover, relaxed licensing regulations that allow pubs, restaurants and bars to sell takeaway pints without red tape holding them back have been extended. Under the relaxed regulations, any site permitted to sell alcohol on their premises can sell for off-site consumption too, without the hassle of applying for a new licence. Premises will also be able to continue to serve alcohol in the area covered by any pavement licence that they may have.
On VAT, the Government already introduced an exceptional one-off VAT cut for hospitality and tourism during the COVID-19 pandemic. A further cut is estimated to cost around £8.5 billion - roughly a third of the Home Office budget. At a time when the public finances are still recovering from the pandemic and protecting the public through the global energy shock, I am not currently aware of plans to reduce the rate of VAT for the hospitality industry. However, at £85,000, the UK has a higher VAT registration threshold than any EU Member State and the second highest in the OECD. This keeps the majority of UK businesses out of VAT altogether.
The Government has also announced a £4.3 billion business rates support package. The small business multiplier will be frozen for a fourth consecutive year, and the 75 per cent relief for eligible retail, hospitality and leisure properties will be extended for 2024-25 - a tax cut worth £2.4 billion.
Regarding the juice content of cider, the present requirement under the Alcoholic Liquor Duties Act 1979 that 35 per cent of the finished product be made up by apple juice was last revised in 2010, following consultation with cidermakers. I believe that this strikes a suitable balance, facilitating the various ancient traditions found on these islands while still allowing for innovation in the sector and large-scale production of popular styles.
The Government has also taken measures to help smaller brewing companies. The introduction of a new Small Producer Relief, which will build on the previous success of the Small Brewers Relief and benefit cidermakers and other producers of lower ABV drinks. This will allow small producers to diversify their product range to other products below 8.5 per cent ABV while still benefitting from reduced rates. Small breweries play a key role in continuing the long and proud tradition of British brewing, and I know that their diverse range of beers and ciders often make up a key part of beers sold in pubs, be that as guest ales or a more permanent addition to the pub’s selection. I know that within our constituency, we have the Leigh-On-Sea Brewery, and many outstanding pubs from the Broker to the Broadway.
I am pleased that the Government continues to recognise the importance of pubs, not only to business and the economy, but also as a fundamental part of British life, culture and history. Know that I will continue to advocate for the pubs and restaurants in our area, and that I am grateful to the committed hard work of publicans and restaurateurs in Southend. Cheers!