Fifty pubs a month closed for good across England and Wales in the first half of this year, with experts warning that tax rises in 2025 could make it even harder for some businesses to keep their doors open.
Analysis by the real estate intelligence company Altus found that 305 pubs were forced to shut their doors permanently in the first six months of the year, meaning the number of pubs in England and Wales fell to 39,096 at the end of June.
The total figure also includes pubs that are vacant and being offered to let, meaning the number of operational pubs is even lower.
Pubs that have “vanished” from the communities they once served have either been demolished and/or converted into other types of use such as homes, offices or even day nurseries, according to Altus.
The rate of closure is lower than the first half of 2023, when 383 pubs vanished, the equivalent to 64 pubs closing every month.
Alex Probyn, the president of property tax at Altus Group, said even more pubs could be forced to close their doors next year as they faced a “double whammy” of extra costs because of inflation and the removal of business rates relief.
Hospitality businesses were given 100% business rates relief by the government between 2020 and 2022 in response to the Covid-19 pandemic. This was then cut to 75%, but will be removed from next April. UKHospitality has estimated that this could cost businesses an extra £928m and lead to bills for some companies quadrupling.
Probyn said: “The last thing pubs need is an average business rates hike of £12,160 next year through inflationary rises and the loss of the discount.”
A spokesperson for the British Beer and Pub Association said: “While we know that brewers and pubs pour billions into the economy, their massive contribution to society is priceless, which is why any closure is devastating. Government must use this budget to cut beer duty, reform business rates, and maintain 75% business rates relief so that pubs can remain a home from home.”
The analysis by Altus found that the north-west of England was the worst hit, with 46 pubs closing during the six-month period. The south-west and the East Midlands were the areas with the next highest closures, with 37 each, while Wales had the fewest closures at 15.
Meanwhile, reports suggest the chancellor, Rachel Reeves, is considering raising alcohol duties in next month’s budget as she looks to plug what Labour says is a £22bn hole in the public finances. However, this will be damaging for wine and spirits producers, who say they are still dealing with the fallout of the largest single duty increase in 50 years last year, when there was a 20% rise on 85% of wines.
On Friday, figures from HM Revenue and Customs showed there had been a £1.3bn drop in alcohol duty receipts in the 12 months up to the end of August, which the Wine and Spirit Trade Association attributes to a drop in sales caused by the higher duties.
Miles Beale, the chief executive of the WSTA, said: “Last year’s damaging reforms to the alcohol excise duty system, including the largest single duty hike in almost 50 years, have hit businesses, consumers and the government purse. Prices have risen, sales are down, and so is duty income by over £1.3bn.”
It is calling on the government to freeze duty on wine and spirits for at least two years to allow sales to recover.