By Andrew Starke

UK Pubs are closing down at a record rate of seven a day as the recession and new taxes take their toll on publicans.

While the Australian pub sector has struggled over the past year it has been spared the worst of the extremely tough trading conditions being faced in some European countries.

According to the British Beer and Pub Association (BBPA), 52 pubs and 461 jobs a week are being lost, with smaller, traditional local pubs most at risk.

The figures for the first six months of 2009 show the rate of pub closure has increased by a third, up from 39 pubs a week in the last six months of 2008.

Over the past 12 months, 2,377 pubs have closed, costing 24,000 jobs. In the past three years a total of 5,134 pubs have closed.

There are now 53,466 pubs in Britain, down from 58,600 in the year before the Licensing Act came into force.

Despite these closures and big pressures, such as additional regulation costs, the industry is also facing a double whammy on beer tax over the next few months – with the planned VAT increase in January 2010 and a further twp per cent above inflation rise in duty in March under the Government’s beer tax escalator.

“The recession is proving extremely tough for Britain’s pubs,” said BBPA chief executive David Long. “However, those economic pressures have been made much worse by a Government that has continued to pile on tax and regulatory burdens.”

“The last two Budgets have seen a 20 per cent increase in beer tax, which alone has added more than £600 million to our tax bill,” he added. “In addition, Government continue to press ahead with the Mandatory Code of Practice, which they say heap at least £30 million of extra red tape cost on pubs in the first year alone.”

“While every other sector seems to receive a sympathetic ear and a tax payer funded handout from Government to tide them through the downturn, all we are getting is a deaf ear and a higher tax bill.”

The BBPA said the industry has faced a double whammy since hard-up drinkers began cutting back on nights out.

Local community pubs are faring the worst, closing at a rate of 40 every week, while branded pubs and cafe style bars are actually opening at two per week.

The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

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