One of the nation’s esteemed pub chiefs has slashed prices across the country in a clarion call to Government and industry alike. Ben Stetson takes a look at Tim Martin’s latest contribution to a political debate.
What’s happened?
Tim Martin, Founder and Chairman of JD Wetherspoon, ardent Brexiteer and all-round geezer, has tried to do the British public a favour in an attempt to seize the ear of the Government by offering a less expensive beverage to wash down your Wednesday.
Across all 900 Wetherspoons pubs in the UK the price of every item on the menu – food and drink – has been cut by 7.5% for twenty-four hours to protest the 20% rate of Value Added Tax (VAT) for the hospitality industry.
Why today? Today is Tax Equality Day. The pub giant is among 15,000 other pubs that have agreed to cut their prices to demonstrate the impact of 5% VAT cut for the hospitality industry. The campaign demands that pubs and restaurants are granted tax equality with supermarkets, premised on the belief that a reduction in VAT will generate long-term growth and create more jobs raising tax revenues collected by the Government.
In sum: cheap booze for punters = sparkly tax receipts for the Treasury.
Why is it important?
Between Brexit negotiations, Cabinet squabbles and Party Conference season dominating the political agenda, one may have forgotten Spreadsheet Phil motoring on in deep inside HM Treasury in preparation for the Autumn Budget. After the noise from conference season dies out eyes and calculators will turn to November 22nd.
Meanwhile, few people need reminding how desperate the Government is to deliver a popular policy proposal. After an underwhelming result (understatement of the year) at the General Election and a number of divisive policies in the manifesto being abandoned, the political and reputational impetus is with the Prime Minister to rebuild her relationship with the public.
Today’s publicity stunt comes off the back of a long standing campaign to reduce VAT for the hospitality industry. Could it reinvigorate the process to cajole the Government into making a popular concession?
Chancellor Philip Hammond, to some extent, holds the pen on the Conservative Party’s short-term fortune. While Brexit remains the totemic issue of the day, the Chancellor has the capabilities to identify a number of short term tonics to sweeten the Conservative brand.
What’s the reaction?
Unsurprisingly, the reaction to the offer of cheaper alcohol amongst consumers and industry peers has been positive. It hasn’t quite turned into the social media parade Mr Martin may have hoped for but there is certainly some support on Twitter. Most prevalently, the move has captured the attention of some of the national titles as well as the local papers en masse.
The real coup here is the proverbial tee the story firmly plants in the ground. Much of the coverage touches on the various industry bodies that have been part of the lobby to slash hospitality VAT. Indeed, the Chief Executive of one trade body was quoted in City AM.
It was unlikely to force a reactionary statement from the Government but it serves as a lingering reminder of the available option to offer a sizeable olive branch to industry at a time when its relationship with business is struggling.
Best headline
Out of a fairly bland set of headlines, the Mirror takes gold with “Wetherspoons cuts the price of its Entire menu for 24 hours – in a war against ‘unfair’ tax”.
What’s next?
Until Budget Day any sequence of events may unfold.
Respective trade bodies, consumer campaigns and private companies will attempt to heighten the pressure on the Government. Expect economic impact assessments, grandiose narratives and populist arguments in favour of creating a level playing field for the industry.
Meanwhile, the Government will be scraping the barrel for every possible positive announcement they can shout about. Keep a close watch on any indications from Cabinet Ministers in their Conference speeches on anything they proffer.
If Martin’s track record of public positions he has campaigned is anything to go by, it is a promising sign for the industry, and probably the Government, that he has made this intervention.
