Wetherspoon boss calls for level playing field for pubs

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JD WETHERSPOON chairman Tim Martin called for a level playing field for pubs after revealing his firm paid £600m in tax over the last year.

The pub giant grew underlying pre-tax profits by 3.1 per cent to £79.4m in the year to July 27, but Mr Martin said pubs continued to be at a disadvantage as supermarkets do not have to pay VAT on food sales and are effectively able to subsidise alcohol prices.

Mr Martin said: “This serious economic disadvantage has contributed to the closure of many thousands of pubs, and the pub industry has lost approximately 50 per cent of its beer sales to supermarkets since VAT was increased from 8 per cent over 30 years ago.”

Wetherspoon’s tax bill rose by £48.7m and now equates to 43 per cent of its £1.4bnin sales, with VAT accounting for £275m. The tax cost is equivalent to £662,000 per pub.

Mr Martin added: “We continue to believe that pubs are taxed excessively and that the Government would create more jobs and receive higher levels of overall revenue, if it were to create tax equality among supermarkets, pubs and restaurants.”

The company increased its headcount by more than 3,000 to 34,000 last year and paid £29.2m in bonuses and free shares to employees, the majority of which work in its pubs.

Wetherspoon now has 927 pubs after opening 46 new sites in the last financial year, with another 30 to 40 sites due to open in the current period.

John Hutson, chief executive, said that the chain is reaping the benefits from the “explosion” in small breweries in the UK, selling both cask and keg ale.

He said Wetherspoon pays “a fair price” to local brewers.

Mr Hutson said Wetherspoon had a record number of pubs in last week’s Good Beer Guide published by CAMRA. One third of the group’s pubs are in the annual guide.

He described the latest results as “another good year of sales with a decent financial performance and quite a lot of investment back into the company”.

Wetherspoon has invested to upgrade catering facilities, improve customer toilets and expand pub gardens, he added.

Graham Pearce of KPMG

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