Thursday, 3 May 2012

Levelling the table-top

Tim Martin of Wetherspoon’s is one of those irritating people who seem to alternate between talking good sense and utter drivel. For example, his comments a while back on the rigid enforcement of age restrictions leading to more unhealthy drinking patterns were spot-on. But his latest claim that VAT puts pubs at an unfair disadvantage on food sales vis-a-vis supermarkets seems very wide of the mark.

I don’t want to go into the basic principles of taxation, but it clearly seems sensible not to levy VAT on basic foodstuffs bought in shops, whereas most meals out are, to some extent, an indulgence, and include a substantial element of service, not just food. While drink sales in pubs have tanked in recent years, the eating-out sector continues to enjoy healthy growth, so to claim that restaurants are being put out of business by Tesco and ASDA seems utterly ludicrous. Even less so than with drink, it’s very rarely a straightforward either-or choice between eating out or in. On this issue at least, perhaps Timbo should stop whingeing and put his own business house in order.

What’s next, you have to wonder, a minimum price for food? Oh...

3 comments:

  1. I agree, I think Timbo is making a poor argument. His argument seems to be that supermarkets can cross subsidise products to sell cheap alcohol. A similar piss poor argument to below cost selling.

    Cheap alcohol is a lure to get the punter in, for sure, as most customers see a cheap slab or case of wine as a bargain considering what it costs in pubs. Milk can be loss led as it is a perishable that punters buy regularly. Selling it below cost has been a winner for supermarkets as punters pop in to supermarkets more often than they need to. Slabs of cheap grog give punters less reason to pop in. It only makes sense if you are trying to win the big Xmas shop.

    The general argument on VAT is a strong one, even if Timbo makes a fist of it. Why should I pay less tax on cans of lager than consumers of the same product in pubs? Accepting higher duty on the proviso of lower VAT would reduce the tax difference. It would also narrow the price gap, something the beards appear to want. You can also make a fairness case for it in the way you cannot with poor people prohibition. One of everyone paying their fair share of tax. I am surprised the beards are now banging on about lower duty. I don’t think they think things through you know. Not like us lot.

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  2. Surely the success enjoyed by Wetherspoons, although not VAT related, is based upon undercutting its competitors with drinks at a price few landlords could even think of.
    How can he complain about an unfairness?

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  3. The main reason for the relative success of Wetherspoons in town
    centres is the closure of many of their competitors.
    Example:
    Ashton u Lyne,Gtr Manchester
    Pubs within 5 minutes walk of Wetherspoons,shut since 2007 ????
    The Player....The Wine Lodge
    Nags Chute....The Hop Pole
    The Vaults....The Burlington
    Pitt and Nelson...Five Stars
    The Albion....The Canterbury
    The Tontine...The Beach.
    5 others for sale ,near empty
    Hardly surprising Wetherspoon were keen on the SCHHHH ban
    If the original FOOD Pubs Ban
    (as in the 2005Labour Mainifesto)
    had been kept to,
    Tim Martin,would be screaming for the ban to be scrapped.
    Must'nt forget his heroic allies.
    CAMRA now huffing but not puffing
    about ale prices and pub closures.
    Just how sad can one get

    Realist

    ReplyDelete

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