Chancellor Rishi Sunak has outlined the Autumn Budget 2021, setting out spending and tax plans for the coming year.
Sunak explained that the changes coming into effect were designed “to help those businesses hardest hit by the pandemic.”
This article takes a look at some of the key Autumn Budget 2021 takeaways for the hospitality industry, as well as featuring expert opinions.
50% business rates discount for companies
Sunak explained: “Pubs, music venues, cinemas, restaurants, hotels, theatres, gyms any eligible business can claim a discount on their bills of 50%, up to a maximum of £110,000.”
As well as the Small Business Rates Relief, he said that this means over 90% of retail, leisure and hospitality businesses will receive at least a 50% discount.
Gareth Ogden, Partner, haysmacintyre, commented: “The discount of 50% in business rates for the next year and modernisation of the system, including a change in the multiplier, will be most welcome. Interestingly the discount will be capped at £110,000 and so whilst it will benefit smaller businesses who have particularly struggled in the course of the pandemic, the comparative impact for larger businesses will be limited.”
National Living Wage increase
The Autumn Budget 2021 has revealed that next year, there will be a 6.6% increase in National Living Wage, bringing it up to £9.50 an hour for those aged 23 and over. This accompanies a rise of 83p for those aged 21 to 22 and a 27p increase for those aged between 18 and 20.
Sandra Rowley at card payment solutions provider takepayments.com, said:”While the announcement of the rise of the minimum wage is welcomed for workers, for small businesses owners this is another cost challenge to running their business.
“On top of the increase in energy bills, increase in petrol costs, rise in inflation and the confirmed national insurance increase, this 6.6% increase would require an additional £1,000 per year for minimum wage full time workers. Whilst there is some welcome news in the budget for hospitality, the overall business environment will remain challenging for those small, independent businesses in the UK.
“One in four (28%) small business owners think the government should offer them extra support to help cover the minimum wage increase, according to our annual business trends report. This extra support could help businesses continue to contribute to the struggling economy.”
Alcohol Duty cut
Sunak announced that the duty on cider served from containers over 40 litres and draught beer would be cut, marking the “biggest cut to cider duty since 1923 and the biggest cut to beer duty for 50 years.”
Gareth Ogden, Partner, haysmacintyre, added :“Similarly, simplification of the alcohol duty system will be met with grateful approval. Wet-led businesses such as pubs and vertical drinking establishments, who suffered more during the pandemic without the ability to switch to food takeaway and delivery models, will especially applaud the move with a permanent 5% cut on draught beer and cider.”
More on the Autumn Budget 2021
To view the full Autumn Budget 2021 and Spending Review, click here.
Holly brings a wealth of experience in both print and digital publishing and is very passionate about the hospitality industry.