The CEO of the Night Time Industries Association (NTIA), a leading hospitality trade body, has today written to the Chancellor urging him not to raise taxes on the sector in the Budget.

Rising costs coupled with tax rises has the potential to create a ‘perfect storm’ that will see many more businesses close for good and consumers unable to afford a night out – a key part of so many peoples social and mental wellbeing.

Michael Kill, CEO of the NTIA, which represents 1400 businesses with over six thousand nightlife venues in the UK, has urged the Chancellor not to raise VAT (from its current rate of 12.5%) or any alcohol duties. Mr Kill says that now is absolutely the wrong time for tax rises, and will add to a confluence of cost factors putting pressure on night time economy businesses to raise prices, including:

  • A shortage of staff leading to higher wage bills
  • Rising operating costs including energy prices
  • High levels of debt, with the potential for increases in interest rates to combat inflation

The letter also points out the devastating effect that the pandemic has had on the sector. With one third of nightclubs no longer operating, and more still at risk, Mr Kill suggests “It would be a waste of millions of pounds of taxpayer’s money, if the financial provision spent on sustaining these jobs and businesses during the pandemic, were to allow businesses to fall at the last hurdle without sector specific consideration within the budget.

Michael Kill, CEO of the NTIA, commented:

“I have written to the Chancellor today to make clear to him what a critical period this remains for the night time economy sector. If he raises taxes now, it will have a catastrophic impact. With all the other operational cost increases, we will see many businesses close and cost the of a night out increase dramatically. For many this will make a night out, so important for so many people’s wellbeing, totally unaffordable.”

“Tomorrow’s Budget is also so important for the wider recovery – he will know there can be no proper recovery of the economy without the night time economy sector getting back to somewhere near full strength. That it is why it is essential he puts the right fiscal framework in place to enable this.”

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