As pubs struggle, British bitter over beer tax
Beer-loving Britons are heading to local pubs for festive tipples as part of the holidays, even as many Londoners fume that their already pricey pint will cost still more in 2017.
A new city tax on business that takes effect next year will rise from an average of about 10% to more than 12%, boosting the price of a pint by more than 40% in some pubs, according to business tax research firm CVS.
“It does outrage me — the premium on a pint in London compared to buying it in a supermarket is already too high,” said Farhud Manzoori, 29, a trader for Nobel Group, as he sipped ale at the Roebuck pub in South London. “It means you have to use a £20 bill (about $25) to pay for two pints. It’s already too expensive.”
According to the Good Pub Guide, the average cost of a pint in the United Kingdom tops $4, but in central London, the price can creep past $6. Average prices in the USA are about the same, according to the website pintprice.com.
Manzoori and his friend Alex Hitter, 24, a graduate student, are tavern regulars and fear that the rising cost of a pint is another financial squeeze in one of Europe’s most expensive places to live.
They call the tax an attack on a great institution.
“The pub is the chief arena for socializing in the U.K.,” Hitter said. “It’s casual fun, but it still feels like you’re doing something despite basically sitting in a living room.”
Making ends meet is increasingly tough for owners of pubs, which are closing at a rate of 27 a week nationwide.
London alone loses about 500 pubs a year, as they fail to compete with trendy cocktail bars and offers of cheap booze from supermarket chains, according to the Campaign for Real Ale.
At the same time, the United Kingdom has among the highest beer taxes in Europe, about 63 cents a pint.
Brigid Simmonds, CEO of the British Beer and Pub Association, said the higher tax could force even more pubs to shutter their doors.
“Independent pubs are going to find it difficult,” Simmonds said.
Simmonds pushes for the government to soften the blow by reducing the beer tax rate from what it is now, along with giving a rebate on business taxes for all pubs.
“Pubs are important to local communities,” she said, “We think pubs should be treated differently.”
Some pubs that have been serving pints for centuries are at risk for the greatest tax increases because of their central locations, popularity and high sales.
The revered, centuries-old Anchor, for example, has been a brothel, a tavern and a chapel.
It sits on the south bank of the River Thames, just around the corner from the Globe Theatre, where William Shakespeare’s plays were performed. The bard himself was a regular drinker there, according to lore.
The pub will have to cough up an extra $182,000 a year when the new taxes begin.
Simmonds said the increase also will hit tourists, who love going to British pubs.
“We want you to keep on visiting, but you may have to pay a bit for your pint,” she said.
Leah Hardiker, 26, an accountant and a regular at the Anchor, isn’t prepared to accept that.
“I come here quite a lot,” she said, “so it’s not good news.”