Wetherspoon makes biggest profit yet – up 37% – but slams pub tax

It’s the favourite pub chain of students and those people who have a pint with breakfast, and now it’s made a record profit.

JD Wetherspoon posted a pre-tax profit of £78.4m, up 37.1% on last year’s £57.1m, in its annual results.

Like for like sales were up 5.5% and revenue up 10% to £1.4bn.

VAT “danger”

However, Tim Martin, the chain’s founder and chairman warned many pubs were going out of business because of VAT.

Wetherpoon paid out £275.1m in VAT last year – at a rate of 20% on its food sales, the same as other pubs.

Meanwhile supermarkets do not pay VAT on food sales.

Martin said: “The biggest danger to the pub industry is the VAT disparity between supermarkets and pubs. Wetherspoon, along with many pub and restaurant companies, is supporting Jacques Borel’s VAT Club on Tax Equality Day (Wednesday 24 September 2014) to publicise this inequality.

“A similar danger relates to the general tone of corporate governance advice and practice which has helped to create unstable board rooms, often preoccupied by the wrong considerations. For example, many do not even recognise the danger from the VAT disparity, despite the high weekly level of pub closures which has lasted for many years.”

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