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One third of UK hospitality businesses operating at a loss

The organisations say the survey “lays bare the impact of recent increases to employer National Insurance Contributions (NICS) and the changes to Business Rates on hospitality businesses”, which amounted to £3.4bn in extra costs.

The number of UK hospitality businesses now operating at a loss represents an 11 percentage point increase on the last quarter. According to the survey, six in 10 reported that they have had to cut jobs and 63% have reduced the hours available to staff in an attempt to “mitigate the increases and stay afloat”.

• Read more: IWSR expects global drinks trade to grow by $16bn

Operators are demanding action from government, calling for “a reversal to Employer NIC changes, a VAT reduction for hospitality, and expedited delivery of lower business rate multipliers”.

In a joint statement, the trade bodies said: “The government seems to be setting itself up to miss its own targets with these most recent cost hikes for the hospitality sector.

“Hospitality is vital to the UK economy but is under threat from ongoing costs rises, which the April increases have only exacerbated. Jobs are being lost, livelihoods under threat, communities set to lose precious assets, and consumers are experiencing price rises when wallets are already feeling the pinch.

“The government must act urgently to mitigate for the changes to Employer NICs and also deliver on its promise of root and brand Business Rates reform. The overall tax burden on our sector must be reduced, including consideration of the long-standing ask of a VAT cut for the sector, so the hospitality industry can return to investment, job creation, and growth in communities the length and breadth of the country.”

• On-Trade
• Business
• closures
• business rates
• uk hospitality
• Hospitality Ulster
• NICs
• British Beer & Pub Association
• The British Institute of Innkeeping
• National Insurance Contributions