What does the business rate rise mean for the wine trade?


Posted on Tue 31st Jan 2017 at 12:08




Business rates are rising from April this year. In many cases they’re rising by a significant amount and in some cases they’re rising by an amount – up to 400% - that seems expressly designed to close the business down.


With appeals unlikely to succeed, and in any case delayed by lengthy wait times, many business-owners are genuinely worried about the future. So how does the wine trade fare in all this? England’s vineyards, sadly, are amongst the hardest hit, with rate rises of 79.3%. This is a severe blow to a sector that has been at the forefront of promoting British artisan goods to the wider world, and could result in decades of hard work to grow and market the industry being lost. Retailers are also being hit, with small independent wine shops the most at risk. This is particularly the case in London, where the inflated value of property, a cornerstone of business rate calculations, has led to some of the highest increases. The on trade is also expecting trouble ahead, particularly in London where restaurants in prime locations are facing a serious hit – Mayfair’s Sexy Fish, for example, will have to pay an extra £1.5million in business rates over the next five years. Peter Harden, of Harden’s restaurant guide, told the Financial Times that the impact would be hard to judge: ‘“You could run into the ‘Toblerone effect’ — the price might be the same but there’ll be one less scallop on the plate”. The ability of smaller businesses to adapt to the changes was especially limited, he said, beyond “sticking a quid on the chips and using smaller sausages”’. What will the lasting effects of all this be? Will we see restaurants switching to cheaper wines with a bigger mark-up, retailers closing and our local vineyards forced to change their production methods or form co-operatives? Only time will tell, but the omens are not good and if there’s ever a time to write to your local MP, it’s now.


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