Cheap Beer Day coming to a pub near you next Wednesday
What will you be doing this time next week? If you want to save some money, you will be in the pub.
Next Wednesday (25th September) is Cheap Beer Day Tax Parity Day, a protest day staged by members of the VAT Club JB. However, unlike most protests (which at best mean nothing to the ordinary person, but at worst mess up your day in some way), this protest actually saves you money and encourages you to go drinking. Win/win.
The point behind the protest (in case you care) is that the hospitality industry is narked at our current high levels of VAT that definitely apply to pubs, clubs and restaurants, but may not apply to supermarkets selling similar products. This is clearly leading to a decline in the industry and VAT Club members are campaigning for VAT on served drinks and food to be changed to the reduced rate, currently 5%.
The JB of the VAT Club JB and mastermind of the campaign is Jacques Borel, a veteran VAT campaigner who has already stamped his feet across Europe, earning VAT reductions in Germany, Belgium, Sweden, Finland and France.
Borel, who has a vested interest, owning 1,042 restaurants and 35 hotels across Europe, believes lower prices will lead to a rejuvenation of the hospitality industry, and create jobs- his mission is “to launch 1.5m new jobs in bars and restaurants across Europe” before he retires. He claims the tax reduction from 19.6% to 5% in France led to the creation of 225,000 jobs in the first year.
For one day only, pub chains JD Wetherspoons, Brains, Heineken, Shepherd Neame and Punch Taverns, alongside family brewers Fuller’s and St Austell, will join forces with Pizza Hut and Subway and will reduce their prices by 7.5%, to reflect the Utopia of a reduced rate VAT world.
Clearly, the difference between 20% and 5% is actually 15%, rather than 7.5%, but Borel is a pragmatist- “if Government cut VAT to 5%, some businesses would pass on the entire cut to their customers, others would pass on slightly less. We believe that the average amount prices would fall for consumers will be about 7.5%” He also doesn’t believe in dressing business as altruism “This is going to be an incredible driver of sales…you have to remember that these guys are not heroes; they are businessmen. They know that reducing VAT will bring in more custom.”
And it seems he’s right on the money. “We’re aiming to make it the busiest day of the entire year,” Tim Martin, JD Wetherspoon’s chairman told The Telegraph. “Creating tax parity among pubs, restaurants and supermarkets will create more jobs and raise the amount of tax that Government receives. It’s a win, win situation for Government, voters and our industry.”
While no-one (other than the VAT man) is likely to complain at a reduction in VAT, it remains to be seen how effective the campaign is. Finding full pubs on Tax Parity Day, however, is only going to provide concrete evidence that it is the extra VAT cost keeping people out of pubs. You could say it is your patriotic duty to join in next week.