The Independent Hospitality Alliance has been set up by 8 leading food trade associations to specifically support the independent sector which has been struggling since the pandemic and which are often ignored by Government and politicians.

 Small and medium-sized businesses employ two-thirds of the UK’s working population and generated over £2 trillion in turnover in 2022.    Almost 70% of all SME’s are in the hospitality industry.

 In 1794 Napoleon described England as “a nation of shopkeepers” referring to the dominance of hard working, local, small-scale enterprises in Britain that were the envy of the world.

 Small businesses are also the nurturing ground for larger enterprises to grow from.

 The Independent Hospitality Alliance strongly believes that the future of the UK economy depends on the UK Government positively supporting the independent sector, particularly in hospitality.

 Many small hospitality businesses are already under extreme pressure and struggling to survive.   The Alliance believes the following immediate changes in Government policy would significantly lift the sector and also increase benefit the UK economy:

 Taxation: The current way tax is applied to the sector inhibits growth and puts the businesses who obey the law and pay their employees well at a huge disadvantage.    The IHA would like to engage with Governement to hghlight the issues with the way VAT is levied and discuss how changes could stillumlate growth in the sector, generate more tax revenue and create valuable jobs.  By having a high tax burden on our sectors sales combined with inflationary pressues on our inputs it is putting many viable businesses in jeopardy.

Replace the current business rating system with a profit related tax.   Many hospitality businesses, particularly in city centres, are still paying excessively high rates (assessed bfore the pandemic) despite the decrease in footfall since the pandemic.   A business tax related to profits would be fairer and would automatically adjust if a situation arose, such as the pandemic.   Furthermore, such a tax would incentivise local authorities to support business growth as their revenues would increase.

 Employment:  Currently those on income support are discouraged from working more than about 16 hours because they start to lose their benefits.   While there will always be a point in the system when benefits override working, by allowing people to work a further 4-6 hours a week before benefits cuts apply would incentivise many to extend their working hours.  This would, in turn, help to address the manpower shortage which is particularly critical in hospitality, ease the cost of living burden faced by many low income families and also enable many small businesses to be more productive.  Furthermore, there would be no cost to the nation as the benefits cost would remain unchanged.

Legislation:  The increasing amount of legislation being imposed on businesses is a serious burden on SMEs which, by their nature, have limited resources.   Consequently, many see the legislation burden as a serious negative against running a small business.    Rather that increasing the legislation burden, we would urge Government to consider alternative approaches that incentivise change.  For example, the scores on the doors scheme encourages businesses to improve their standards.   A similar scheme to promote healthier menus would be preferrable to taxing, particularly as taxes tend to be a blunt instrument in the longer term as consumers adjust to them as they do most price increases.