The Chancellor Rishi Sunak is due to announce his mini budget under mounting pressure for him to cut taxes, particularly around VAT, Fuel and Energy.
Businesses across the Night Time Economy have seen cost inflation soar over the last few months, with many relying heavily on the budget to alleviate some of the financial pressures.
The recent statement by Sunak suggests he is resolute in being unable to solve all of the current issues faced by the market at present, as a culmination of both post pandemic impact and sanctions due to the conflict in Ukraine are having a direct impact on the UK.
Businesses within the Night Time Economy who are already struggling from increased costs, losses and debt incurred during the pandemic, face rocketing energy and insurance bills, with even small premises seeing prices double or treble compared to previous contract rates, costing them up to an extra £60,000 per year.
Unless urgent support is given, there will be a catastrophic effect on the economy with many cafes, restaurants, bars, hotels, venues and nightclubs forced to close due to escalating costs, sending thousands of people out of work.
As more and more businesses fall out of their energy contract, renew insurance as well as taking on increasing operating costs each month, up to 50% of businesses across the Night Time Economy could reach a tipping point in the next 12 months.
Michael Kill, CEO NITA said, “We must now rely on the Chancellor once again, in his mini budget, to sure up the financial support and relief to allow headroom for businesses to survive, in light of the current debt levels and cost inflation, specifically around VAT, energy and fuel.”
“Billions of pounds in public funding will be wasted, if the Chancellor lifts taxes within the budget, crippling an industry that has worked hard to survive, only to be let down at the last hurdle.”
“The rhetoric from government of ‘Leave no one behind’ is becoming a distant memory for businesses that committed to supporting the Government’s public health strategy, but have been left once again awaiting their fate.”