The VAT rise has created a new breed of pub customer, according to a member of the Scottish Licensed Trade Association.
Bill Wisdom, a representative for Dundee and Angus, believes customers have never been more aware of the price of a pint since VAT went up at the beginning of the year.
After meeting a number of local publicans during the week, Mr Wisdom told The Courier on Wednesday that those customers who are still trickling through pub doors have never been keener to know how much they’re paying.
“As far as the VAT rise is concerned, publicans are saying that there’s not been a noticeable impact. However, what they are saying is that customers are becoming more inquisitive to pricing and instead of accepting the cost are now asking why they are going up.
“Nobody can pin anything exactly on the VAT issue, but the trade is definitely in recession. Premises that have been on the market for some time are still not moving. It’s definitely a problem but the trade is still surviving.”
Despite many publicans predicting the worst when VAT increased to 20% in January, most appear to have weathered that storm for now.
But Mr Wisdom believes the real tests may lie in the coming months as breweries review beer prices ahead of the summer — possibly forcing landlords to raise prices once again.
“It’s the time of year when brewers look at increases in the price of beer. The VAT issue has affected them and they have overheads as well.
“One of the guys I was speaking to today was saying that if you look around you either see pubs that are doing exceptionally well or not trading at all — there’s very little in between any more.”
It is thought that around 52 pubs a week were closing across Britain. Although this has dropped dramatically, the trade is still limping along in the uncertain economic climate.
Research carried out by Oxford Economics for the British Beer and Pub Association estimated nearly 9000 jobs could be lost as a result of the VAT rise, while plans to increase beer duty in March’s Budget could cost another 10,000 posts.