South West pub and beer industry pour £2.8 billion into UK economy

South West’s beer and pub sector poured more than £2.8 billion in Gross Value Added (GVA) into the economy and contributed more than £1.2 billion in tax in just one year, according to new research by the trade body.

As a whole, Britain’s beer and pub sector poured more than £34.3 billion in Gross Value Added (GVA) into the economy and contributed more than £17.4 billion in tax in just one year, according to new research by the trade body.

Latest figures from 2024 Oxford Economics research show GVA contributions were up from the previous contribution of £2.1 billion.

 These figures demonstrate the sector’s important economic contribution to both their region and the wider national economy, the British Beer and Pub Association (BBPA) said.

But despite this, pubs make an average of just 12p on every pint of beer once taxes and costs have been deducted.

Not only that, but the industry is also facing multiple burdens and restrictions in the form of proposed eyewatering packaging costs and a potential beer garden smoking ban.

Now the BBPA is calling for a reduction in soaring costs of doing business. It warns the industry needs government support from the Budget to make sure the sector can continue to contribute to the economy and boost the country’s finances.

The BBPA wants to see a cut in beer duty, business rates reform, and a pledge to keep the 75% business rates relief to ensure that pubs can survive.

Emma McClarkin, CEO of the BBPA, said: “The South West sector’s growth will underpin economic growth, which is why if the Government truly is business-friendly, it must recognise that pubs and brewers are shouldering multiple taxes and costs that are squashing growth and could lead to businesses failing.

“There is no more meat on the bone to cut, which is why it we are calling on the Government reduces the cost of doing business so we can continue to make a massive contribution to the public purse.

“It is imperative there is a reform in the business rates system which currently penalises bricks and mortar businesses like pubs which pay five times more than their share of turnover.

“Until then, the vital 75% business rates relief due must be maintained for pubs so that one of the core cost components of doing business can be controlled. In addition, we urgently need to see a cut in beer duty.

“Our industry is an economic bellwether and when pubs and brewers suffer, the economy suffers. If the Government wants to succeed in its growth mission, it needs to support our beer and pubs which play such a vital role in our communities.”

The sector is also facing potential eyewatering EPR recycling costs next year – set to be among the highest in Europe – plus increases in energy prices. The trade body has warned that this could lead some brewers to make heartbreaking decisions about whether they can keep making their beer.  

Not only that, but a proposed smoking ban in beer gardens would have a devastating impact on many pubs and affect their viability as businesses. The BBPA is urging Government to reconsider this misguided restriction.

The industry is one for the most heavily taxed business sectors per pound of turnover in the UK with tax making up 40% of UK brewing turnover and £1 in every £3 spent in pubs.