Wetherspoons founder urges VAT and business rates reform ahead of November budget

Tim Martin, founder of the Wetherspoons pub chain, has urged Chancellor Rachel Reeves to reform VAT and business rates ahead of the government's Budget on 26 November, saying hospitality firms are being hit by "wildly excessive taxes" and a tax system that disadvantages pubs relative to supermarkets.

In a plea published on the London Stock Exchange news service, Martin, who launched Wetherspoons in 1979, repeated long-held complaints that pubs pay the 20% standard rate of VAT on food while most supermarket food remains zero-rated. He said the disparity distorts competition and harms high streets and social life, arguing that equal treatment would encourage more on-premise spending.

Martin also highlighted a rise in business rates that the industry says hit hospitality hard in April. The sector was met with what has been described as a £500 million increase in business rates earlier this year alongside other cost pressures, including an increase in employers' national insurance contributions and a higher minimum wage. He told ministers that pubs can pay substantially more in business rates than supermarkets and called for a lower multiplier rate for hospitality to reduce bills for venues.

Industry figures say the operating environment has led to substantial job losses. Analysis by trade body UKHospitality of official figures indicated some 89,000 jobs in the sector have been cut since the Budget last October. UKHospitality has argued the current business rates system penalises brick-and-mortar hospitality outlets and has urged the government to deliver targeted relief for the sector.

Rachel Reeves has proposed business rates reforms intended to rebalance taxation between physical premises and online competitors, but the measures have drawn criticism from parts of the retail sector. Large supermarkets have pushed back after proposals raised taxes for bigger premises, warning changes could hit "anchor" stores that attract customers to town centres. Retail groups say around 4,000 shops could face higher rates under the plans.

Kate Nicholls, chief executive of UKHospitality, welcomed reform of the rates system but urged the government to use the Budget to provide the maximum possible discount for hospitality firms. "Hospitality businesses all agree that the current business rates system is completely broken and unjustly penalises bricks and mortar businesses, like those in hospitality," she said.

Martin's call adds to a chorus of hospitality bosses pressing the Treasury for targeted tax relief or parity measures in time for the November Budget. He framed the case as both an economic and social issue, saying equal VAT and business rates would help pubs compete with supermarkets and support local communities.

There was no immediate response from the Treasury or the Chancellor's office to Martin's comments. The government has previously said business rates reform is aimed at creating a fairer system for high streets while ensuring public finances remain sustainable.