Co-owner says future of The Crown at Stoke-by-Nayland is at risk due to 51% increase in business rates
The co-owner of one of Suffolk’s top food pubs says that its future is a risk following news that its business rates are due to rise by more than half.
The Crown at Stoke-by-Nayland, which employs around 60 people, has operated successfully under its current ownership since 2003 and has been named by The Good Pub Guide as its Suffolk Dining Pub of the Year twice in the last five years, including the current edition.
But Richard Sunderland, who owns the Crown jointly with other investors, says the combination of a recent revaluation of the property for business rate purposes, increases in the minimum wage and the introduction of compulsory workplace pensions is “threatening its very existence”.
Mr Sunderland, who is now planning an appeal against the increase, said that since the addition of 11 hotel bedrooms at the Crown nine years ago, the annual rates bill had already risen from £18,000 to £68,000.
Following the latest revaluation the bill was now set to rise by a further 51% to around £102,000 a year – an extra £34,000 which, at a time when other costs including pay and pensions were also rising, represented a “very real dilemma” for the business, said Mr Sunderland.
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A nationwide review of valuations for business rate purposes has, overall, resulted in more winners than losers in the East of England.
However, a number of pubs – regionally and nationally, and particularly those with a major eating-out element within their business – have been hit with substantial increases.
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Mr Sunderland said: “We have made repeated warnings to our local MP, past and present, that Government initiatives of substantially increasing the minimum wage and the introduction of work-based pensions – good and well-intended initiatives in their own right – not to mention the increase in goods as a consequence of the Brexit vote will all have to be paid for and that, unless we saw reasonable and sensible action towards the revaluation of business rates for 2017, there could be catastrophic consequences.
“This has clearly fallen on deaf ears, and this Government is sleep-walking its way into obliterating vast chunks of the retail sector,” he added.
James Cartlidge, MP for South Suffolk, said: “I have met with Richard Sunderland to discuss his revaluation. It is not generally appropriate for me to comment on individual rating decisions but I do agree that the rates system can appear to be working in a very perverse way if your priority is to support enterprise.
“His is one of many such cases where you look at what is happening and ask ‘Is this really supporting business in my constituency?’
“Of course, the Government held a review and has focused its conclusions on supporting smaller businesses with a number of positive changes, such as permanently doubling the rate relief on small businesses so that, from April 2017, 600,000 small businesses will pay no business rates at all.
Mr Cartlidge continued: “The problem is that the tax raises over £20bn per year and so we cannot just magic it away.
“My personal view is that we should have at least set out some fundamental alternatives for reform because they would all have winners and losers, but at least we could have spelled those out and continued the debate.
“As it is, if businesses feel we have shut down reform they will be even more frustrated.”