Responding to the Government’s consultation on capital allowances, which closes today (1 July), the BBPA supported calls by other leading trade bodies such as the Confederation of British Industry (CBI) to introduce a permanent 100% deduction for investment in capital allowance.
“We find ourselves in a position as a sector where we are keen to get back to business, provide the best service and experiences for our customers and thrive at the heart of communities across the country, but we are being held back by a lack of incentives to invest,” says Emma McClarkin, chief executive of the BBPA.
The call comes after data released earlier this week revealed that only 28% of hospitality businesses are currently considering any sort of investment due to the challenging economic climate.
The BBPA says the tax relief would replace the current super deduction and introduce a system of ‘full expensing’ allowing businesses to immediately deduct qualifying investments from their taxes, rather than spreading the deduction over time.
It is estimated such a system could also unlock the UK’s international investment potential, moving from bottom of the G7 ranking for business investment to fifth by 2026.
In addition, the trade body notes that any adjustment to capital allowance tax should sit alongside a review to planning processes; with long application and approval processes currently acting as a major blocker to many pub companies investing in their estates.
“Our pubs and breweries need to feel confident to spend their money, especially after the past two years, and a permanent deduction would go some way to providing assurance and allow them to make investments to upgrade their venues, take on new properties and ultimately grow their businesses,” adds McClarkin.