Whitbred, the owner of Premier Inn, has warned that tax rises are becoming more likely and could pose a serious risk to the UK’s hospitality industry.
Chancellor Rachel Reeves faces a £40bn gap in the nation’s finances, which is ever-more likely to be filled by a tax-raising Autumn Budget.
The target of those tax rises has already been under heavy debate, with pundits predicting everything from a tax on landlords’ incomes to a reduction in tax breaks for Brits making pensions contributions.
“We recognise the mounting pressure for tax rises and broader fiscal tightening as part of the upcoming Budget,” Whitbred which reported a three per cent dip in half-year sales to £1.41bn on Wednesday, told markets this morning.
Its pre-tax profit also fell from £357m to £331m over the same six-month period.
“There is a risk that these measures could disproportionally impact hospitality and property sectors, an issue we have actively lobbied against, in collaboration with other industry groups,” the company added.
Whitbred’s share price has fallen by nearly ten per cent this morning.
Hospitality ‘being left to collapse’
Around half of the jobs lost since last Autumn’s controversial Budget have been in the hospitality sector, while one in five hospitality firms have no cash reserves.
“Hospitality is one of the few industries safe from AI disruption, and yet it’s being left to collapse,” Imme Ermgassen, co-founder of Botivo, said.
“Where did you have your first job? Where could you pick up the odd shift? Where did you meet your mates after a long day? If independent venues vanish, so do the spaces that shape creativity, community and belonging,” she said.
Saxon Moseley, partner and head of leisure and hospitality at RSM UK, said: “After bearing the brunt of this year’s tax rises, the sector is calling out to the government for bold, meaningful support measures in the Budget.
Brewdog has calculated that the UK brewing and hospitality industry has been a £1bn rise in costs over the last 12 months, driven by soaring energy bills, rising labour costs, escalating ingredient and packaging prices, and tax changes.
Brewdog warned that warned that the forthcoming Autumn Budget “represents a critical moment for the future of Britain’s brewing and hospitality industries”.
Emma McClarkin, chief executive of the British Beer & Pub Association, said: “We urge the Chancellor to act in the Budget to recognise the importance of the beer and pub sector to our economy and community by detailing meaningful business rates reform, cutting beer duty and reviewing punishing employment and packaging costs so we can thrive at the heart of high streets, towns and villages across the UK.”