Boris Johnson has hinted at a potential reduction in tax on alcohol served in pubs ahead of next week’s budget.

Rishi Sunak is due to set out his spring budget on March 3 when the Chancellor is expected to outline plans to ease pressures on struggling industries and encourage the public to revive the economy.

The Prime Minister has recently been urged to give a helping hand to pubs who have endured months of no trade after three national lockdowns.

Under review

During this week’s PMQs, Mr Johnson was asked about the idea of cutting tax on alcohol served in pubs and adding it onto supermarket alcohol instead.

The Prime Minister said it was an “extremely good point” adding: “which I’m sure will be heard with great interest around the country.

“There is such a review being carried out after consulting owners and brewers and I know that the Chancellor is looking very closely at the findings.”

The changes would have to be made by Rishi Sunak but would provide welcome support to the hospitality sector which has been dealt a cruel blow throughout the pandemic.

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It would come as pub, restaurant and hotel bosses have urged Rishi Sunak to also reduce VAT for on-premise alcohol sales, leisure activities and weddings in the spring budget.

Earlier this month, hospitality bosses demanded that the reduction of VAT from 20% to 5% on food and soft drinks is extended into the next financial year and also expanded to cover more areas of the sector.

“Should we be allowed to reopen in the run up to Easter, it could also help us avoid having to pass on substantial price rises to customers in early April as a result of returning to a 20% rate, just prior to the Easter trading weekend,” bosses said in the letter.

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They have also called for the current business rates holiday, which is currently due to expire by April, to be extended again.

Kate Nicholls, chief executive of UKHospitality, said: “We are hopeful that, in the coming weeks and months, we can begin to welcome customers back and we know that people will be eager to socialise with their friends and families safely in our venues.

“That means we need to start laying the groundwork now.

“We need to make sure that the hospitality sector is in the best possible position to help rebuild as we done in the past.”

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