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WSTA presents three-point aid plan to Chancellor

Written today, the letter calls on the Chancellor to extend immediately the support on offer to pubs, bars and restaurants to wider hospitality supply chain businesses, many of which have seen demand reduced to zero almost overnight, but which are currently deemed ineligible for much of the government’s support. 

Furthermore, it urges the government to employ the same approach to excise duty as it does to VAT, and implement proactively a duty deferment scheme – in the same way it has for other taxes. 

Spreading duty payments over the remainder of the year from the summer would result in no loss of revenue to the Exchequer, but would provide a “vital and welcome cash injection to businesses”, said the WSTA. 

This cash injection could prevent smaller businesses being lost amid current restricted trading conditions, and would help larger businesses maintain payments to other businesses throughout the sector, it added.  

Finally, the WSTA has asked for a “simple technical fix” – to allow businesses to put stocks of duty-paid wines and spirits back into excise suspense to allow them to claim back duty already paid on products not yet sold and further ease cashflow pressures.

“We have welcomed the Chancellor’s efforts to date to help businesses and those they employ navigate the chaos that coronavirus has wrought – but that much of the promised support has so far comes in the form of loans that are proving hard to access, take valuable time - and must eventually be paid back,” said Miles Beale, CEO of the WSTA. 

Many businesses saw those measures as providing "nothing more than a stay of execution. The Chancellor needs to go further still”, he added.   

“Today, we have written to government asking them to make three immediate changes that are simple, low cost and will provide immediate support to businesses in our sector. The extension of support to businesses in the hospitality supply chain – which have been almost completely forgotten despite facing the same immediate pressures - cannot come soon enough. Like pubs, bars and restaurants, the businesses that supply our hospitality sector have seen business reduce to zero almost overnight, but are currently barred from accessing schemes like business rates relief or small business grant funding. This must change – and fast,” he said. 

Government also urgently needed to introduce measures to help businesses tackle “the single biggest immediate challenge – cashflow”, added Beale.  

“Our proposals to implement a blanket excise duty deferment scheme and to allow wine and spirit businesses to put stock back into duty suspense, would help alleviate the cashflow crisis immediately.”

Beale also took the opportunity to express the WSTA’s disappointment that its calls for an urgent suspension of duty payments for at least six months were overlooked last week. 

“Many of the businesses we represent have had to settle a large bill whilst knowing their ability to trade will be severely restricted for the foreseeable future. We would urge Chancellor Rishi Sunak to look again at this area, and take steps to offer our sector the support it needs.”