More than 1,550 pubs and bars in the UK will see price increases from Marston's in response to the latest Budget tax announcement. The forthcoming price changes will result in draught beer costing 10p more per pint for pub patrons. In order to represent regional price variations, these price increases will fluctuate by location.
According to Marston's, the price rise is primarily to offset higher costs resulting from the October budget adjustments. The pub group wants to control for the broader economic climate and growing business expenses, including a large rise in employment costs. The company's impressive financial performance was demonstrated when it recently announced a 65% increase in pre-tax profits for the year ending in September 2024.
Key Takeaways
Budget tax adjustments have led to price hikes across UK pubs and hotels as businesses struggle with increased costs.
- Marston's will increase prices by up to 10p per pint in response to the Budget tax announcement, with other companies such as Wetherspoon and Fuller's also hinting at possible price rises.
- The British Beer & Pub Association (BBPA) has called for a reform of business rates and a reexamination of the timing of increased personnel costs, warning that delaying action could cause serious problems for the industry.
- Rising operating costs, including higher wages and National Insurance Contributions, are prompting several companies to warn of price increases, with some hotels and establishments already changing their tariffs.
Wider industry impact
The larger retail and hospitality industries are feeling the effects of the budget cutbacks. Employers are preparing for higher expenses beginning in April 2025 as a result of the estimate that the change will raise about £25 billion. Other companies, such as Wetherspoon, Mitchells & Butlers and Greggs, have also hinted at possible price increases.
Due to growing operating expenses, Tim Martin, the chief executive of Wetherspoon, has cautioned customers to expect rising prices at his restaurants.
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The chief executive of Fuller's, Simon Emeny, has also announced a 10p rise in beer pricing at their establishments.
According to the British Beer & Pub Association (BBPA), these reforms will result in an extra financial burden of more than £650 million for the brewing and pub industry.
BBPA calls for action on budget tax impact
Concerned about the government's recent budgetary measures, the British Beer & Pub Association (BBPA) has called for a reform of business rates and a reexamination of the timing of increased personnel costs.
Representing the beer and pub industry, the BBPA highlights the sector's importance to the UK economy, contributing almost £1.7 billion in taxes for His Majesty's Revenue & Customs (HMRC), including £136 million from beer duty.
The BBPA has demanded further assistance to lessen the effects of the Budget's increased financial strains on the pub trade. Emma McClarkin, the association's CEO, warned that delaying action could cause serious problems for the trade. Over £650 million in increased expenses are anticipated due to growing National Insurance contributions (NICs).
Companies, such as Marston's, have already raised prices, including a 10p increase in the price of a pint, while others like AO World and Halfords are considering price hikes due to rising staff costs. As firms across the UK face higher operating costs, these developments highlight the financial hardship many sectors face due to the Budget changes. The BBPA calls for targeted support as the industry endures mounting pressure.
Hospitality sector faces rising costs
Cost increases are a problem for the hotel and tourism sectors, especially in light of the most recent budgetary adjustments. Rising operating costs, such as higher wages and National Insurance Contributions, are prompting several companies to warn of price increases. Some hotels, taverns, and recreational facilities have already changed their tariffs, including higher prices for drinks.
Concerns about the impact on business performance are growing as some establishments struggle to attract customers. The ongoing workforce shortages in the UK hospitality and leisure industry are intensifying competition for jobs. While there are growing career opportunities, the financial pressures from price hikes may complicate recruitment efforts.
Given the importance of the hospitality industry to the UK economy, the government is coming under increasing pressure to support it. To assist companies in overcoming these obstacles and lessening the effect of price increases on consumers and industry workers, reforms to business rates and employment expenses may be essential.