VAT's The Problem The Mill, Stokesley

The Mill at Stokesley is a vibrant family friendly gastro style pub with strong community connections in the North Yorkshire market town of Stokesley. It hosts regular events and runs community focussed activities, like social dog walking groups and golfing days out.

Licensee Alex Cook built up this award-winning business and on the back of its success opened an Italian restaurant and café bar in the same town.  The Mill Group now employs 71 members of staff, 41 of which work at The Mill. 

Says Alex: “VAT has always been an issue for pubs in the UK.  It is half that of our European equivalents.  It’s just now the impact of VAT is amplified as a result of the added pressures put on pubs by the minimum wage, energy and food costs.  We can’t claw those expenses back, so our only hope is to try and get this ridiculous VAT rate lowered.

“The Government is completely out of touch with what’s happening in the pub industry.  It was a question of getting blood out of a stone two budgets ago and still they’re trying.  The two disastrous budgets for pubs mean there’s nothing left.  It’s become increasingly difficult to make a living let alone a profit.  Ours is a pub in rural north Yorkshire, not a London pub, yet we’re having to charge £7 a pint and consequently have seen a reduction in footfall.  Customers don’t question the reason why this price, they know how hard it is.  I have to pass on costs, but I can’t increase prices further.  I can’t cut staff costs any more either – I have shaved £150,000 on my wage bill in the last 12 months, the equivalent of five jobs which could have generated income tax for the Government.  It’s not that these jobs have disappeared; we’re having to work flat out and more.  Pubs only continue to exist because publicans have a passion for what they do. I still love the role and go to work with a smile on my face. But it’s not enough.  My businesses don’t have the funds in them to sustain necessary investment.  I am having to use my personal money and gamble my family’s future to keep my businesses going.  Record weeks aren’t celebrated any more, they need to be hit every week just for survival.  The Mill wouldn’t live through a bad quarter.

“If VAT were reduced it would mean we could come out of our VAT payment plan.  Currently if we didn’t have one, we wouldn’t be able to afford to pay our staff.   It would allow us to survive.  In time once we’ve caught up then we can look to grow further and give young people more opportunities.

“We’re driving really hard, but I am not sure other pubs have the same energy to get through.  Many pubs won’t see Christmas this year, they will collapse by the end of November.  I am pushing forward in the hope that the Government will finally see sense and provide the hospitality industry with much needed VAT relief.  Yes, there will be some real opportunities on the back of other people’s misfortune, but how many will be able to take those up is questionable.”