The Night Time Industries Association (NTIA) has issued a statement urging Chancellor Rishi Sunak to provide “urgent support” to the sector ahead of his forthcoming ‘mini-budget’ announcement.
Sunak will present a summer statement tomorrow (March 23), in which he’s expected to announce a series of new policies aiming to alleviate the economic slump caused by the coronavirus pandemic and Russia’s invasion of Ukraine, and to ease the cost of living crisis.
In a statement, the NTIA said: “Businesses within the Night Time Economy who are already struggling from increased costs, losses and debt incurred during the pandemic, face rocketing energy and insurance bills, with even small premises seeing prices double or treble compared to previous contract rates, costing them up to an extra £60,000 per year.
“Unless urgent support is given, there will be a catastrophic effect on the economy with many cafes, restaurants, bars, hotels, venues and nightclubs forced to close due to escalating costs, sending thousands of people out of work.”
The statement also claimed that, due to energy contracts and insurance up for renewal, as well as increased operating costs, “up to 50 per cent of businesses across the Night Time Economy could reach a tipping point in the next 12 months.”
NTIA CEO Michael Kill said further: “We must now rely on the Chancellor once again, in his mini budget, to sure up the financial support and relief to allow headroom for businesses to survive, in light of the current debt levels and cost inflation, specifically around VAT, energy and fuel.”
“Billions of pounds in public funding will be wasted, if the Chancellor lifts taxes within the budget, crippling an industry that has worked hard to survive, only to be let down at the last hurdle.”
“The rhetoric from Government of “Leave no one behind” is becoming a distant memory for businesses that committed to supporting the Government’s public health strategy, but have been left once again awaiting their fate.”
Last week, Sunak was urged by UK Music chief Jamie Njoku-Goodwin to scrap a large VAT tax hike on concert and live event ticket prices. The 7.5 per cent increase is set to kick in on April 1.
VAT is currently charged at 12.5 per cent on tickets for live events but Sunak is planning to restore the tax return to its pre-pandemic level of 20 per cent.
It comes after Sunak was previously criticised for his handling of the Brexit touring fiasco – as well as potential future provisions for nightclubs and music venues.