Wetherspoon's share price soars after Chancellor cuts 'beer tax' and extends business rates relief
30 October 2024, 14:52 | Updated: 30 October 2024, 15:09
The share price of JD Wetherspoon and other big hospitality businesses soared on Wednesday after Rachel Reeves cut tax on draught drinks and extended business rates relief.
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The Chancellor said in her Budget announcement that the government would cut draught duty by 1.7%, which she said means "a penny off a pint in the pub".
Ms Reeves also announced 40% relief on business rates for retail, hospitality and leisure businesses from 2025/26.
JD Wetherspoon's share price rose 6% on the start of the day during the Chancellor's Budget speech, before falling again afterwards.
The company's share price is still down over 5% over the past five days.
Read more: Budget 2024: Key points at a glance
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MPs go wild as Rachel Reeves announces cuts to tax on beer in pubs
Some other pub companies also saw their share prices rise as the Chancellor made her speech.
Marston's was up over 6% early on Wednesday afternoon, while All Bar One owner Mitchells and Butlers' share price also rose by nearly 6%. Young's and Co. saw its share price rise by nearly 9%.
Announcing the tax cut, the Chancellor told the Commons: "I can confirm that alcohol duty rates on non-draught products will increase in line with RPI from February next year, but nearly two-thirds of alcoholic drinks sold in pubs are served on draught.
"So today, instead of uprating these products in line with inflation, I am cutting draught duty by 1.7%, which means a penny off a pint in the pub."
Addressing the business rates changes, Ms Reeves told MPs: "Let me turn now to our high street businesses. I know that for them, a major source of concern is business rates.
"From 2026-27, we intend to introduce two permanently lower tax rates for retail, hospitality and leisure properties, which make up the backbone of high streets across the country, and it is our intention that is paid for by a higher multiplier for the most valuable properties.
"But the previous government created a cliff-edge next year, as temporary relief ends, so I will today provide 40% relief on business rates for the retail, hospitality and leisure industry in 2025-26, up to a cap of £110,000 per business.
"Alongside this, the small business tax multiplier will be frozen next year."
