Outspoken JD Wetherspoon boss Tim Martin is not letting-up on his calls for a fair tax deal for pubs, despite his company posting strong profits. The pub chain’s annual results reveal a pre-tax profit 0f £78.4 million – an increase of 37.1 per cent on the previous year.
Nevertheless, Martin insists that the tax disparity between pubs and supermarkets is behind the closure of over 10,000 pubs during the past decade, and is calling for support for Tax Equality Day on September 24th to highlight the issue.
He says that the average pub in Wetherspoon’s 800 strong chain, directly employs around 30 staff and many more indirectly. They also contribute to the vitality of the high street and Martin quotes Prince Charles by claiming that “the pub is the hub.”
“The benefits of pubs are widely recognised, illustrated by the recent introduction of legislation which requires planning permission for pubs to be converted to shops or other uses, in certain circumstances,” he says. “In planning jargon, pubs are assets of community value – as if we didn’t know.”
But pubs are struggling under the weight of the VAT system, he argues, since they pay 20 per cent VAT on food sales whereas supermarkets pay none. This ‘massive tax break’ enables supermarkets to subsidise the price of alcoholic drinks widening the price differential and damaging the licensed trade.
Wetherspoons pubs will draw attention to this price differential on Tax Equality Day by slashing their prices by 7.5 per cent.
Last year’s event, organised by VAT Club Jaques Borel, took place in 15,000 pubs and restaurants across the country, and Martin is calling for support again this year to press the case for a VAT cut which, he believes, will create 700,000 jobs.
Martin has also waded into the debate about next week’s referendum on Scottish independence, dismissing claims that a Yes vote will create a period of uncertainty as ‘nonsense.’
He points to New Zealand, Switzerland and Singapore as examples of small countries which prosper independently and says the business community should leave it to the Scottish electorate to decide the nation’s destiny.
Martin even hopes that a Yes vote may benefit the campaign for VAT equality – if the Scottish Government led the way in introducing the reform.
“I’d be banging the drum for that,” he said. “I’d wear a kilt, I’d do anything.”
