St Austell Brewery CEO: ‘The chancellor has tried to claim business rates are going down’

The chief executive of St Austell Brewery and former chairman of the British Beer & Pub Association has criticised the government for misleading publicans on business rates.

In an open letter, Kevin Georgel said that last week’s Budget “heaps yet more cost and pain on a sector that simply cannot bear it”.

Despite having approached the Budget “with a degree of optimism”, he said the changes to the business rates system will provide little breathing space for hospitality and that business rates, crucially, will not be going down.

While the overall multiplier used to calculate bills is lowering, many businesses will pay higher taxes next year when rateable values are reassessed and the 40% discount for retail, hospitality and leisure properties ends.

He explained that even before the Budget, a £5 pint had already included £2.03 of tax. After additional costs, publicans were left with 13p of profit per pint, but that is only set to rise further as a result of last week’s announcements.

Georgel wrote: “The government has chosen to impose even more punitive taxes on businesses that support jobs, communities and local economies across the UK.

“Worse still, the chancellor has tried to claim business rates are going down. This is misleading to people across the country who know the importance of local pubs to their communities and want to see these businesses being supported, not taxed out of existence.”

The sharp rises in rateable values and the scrapping of business rates relief will mean that from April 2026, publicans will face an average business-rate hike of 76%, phased over three years, while warehouses and online retailers expect a 16% increase over the same period, according to Georgel.

He added: “[The 76% increase] is equivalent to an extra £13,000 per annum in additional tax. And these increases have nothing to do with rising profits – pub profits are falling. Revenues are only up because we’ve been forced to raise prices to try and keep pace with inflation, soaring utilities and steep rises in employment costs. This includes above inflationary increases in the National Minimum Wage and the changes to National Insurance announced at last year’s budget, which were extraordinarily damaging for the pub industry.”

Georgel also said the Budget will be “particularly concerning” to regions such as the south west, which is especially reliant on tourism and hospitality. He added: “Even a business like ours – with financial stability and supportive shareholders – will be forced to significantly scale back our investment plans, because of the choices made in this and last year’s budgets.

“Despite all this, our sector will remain resilient. In the weeks and months ahead, St Austell Brewery will be fully supporting industry bodies to ensure that the implications of the budget – and its damaging impact on hospitality – are fully understood by the government.”

St Austell Brewery was founded in Cornwall in 1851 and still operates as a sixth-generation family business.

UKHospitality is calling on the government to urgently increase the level of discounts for hospitality properties from 5p to 20p, as previously proposed and permitted by law.