Late Night Levy is a flop

Since it was introduced in 2012 by the then Home Secretary Theresa May the tax on licensed premises, which was supposed to pay for the cost of policing the late-night economy, has only been adopted by eight licensing authorities and it has raised about £3.5m in five years.

Under the scheme a local authority makes the decision but introduce the levy on its licensed premises with 70% of the money collected going to the local police to spend more-or-less as they see fit. The remaining 30%, retained by the local council, is generally spent on things that address late-night economy problems such as alcohol treatment schemes.

The levy is targeted at pubs and clubs that open between midnight and 6:00 am. In addition to the levy early morning restriction orders could ban a licensed premises from opening between those hours if it was deemed to be troublesome.

Only eight places have introduced the levy: Newcastle, Southampton, Islington, Nottingham, Cheltenham, The City of London, Camden and Chelmsford. Brighton & Hove toyed with the idea for a while but the local authority was reluctant to commit. The cost of the levy is set nationally and is dependent upon the rateable value of each premises.

BCRP COMMENT

Research conducted by the Brighton & Hove BCRP when the levy was being considered for Brighton found that it rarely raised the sums anticipated because many venues that might have stayed open until 12:30 to 01:30 simply adjusted their closing times to shut before the threshold hour of midnight.

The levy is also flawed because it has to be imposed on all licensed premises in a licensing authority area. This means that pubs and clubs in the suburbs would be charged a tax that was effectively for addressing problems in the city centre. If you take a London borough like Wandsworth as an example, Balham and Tooting have no problems with the late-night economy but they would have to pay to address issues in Putney and Wandsworth Town. Given that unfairness and the paltry sums raised it is hardly any wonder that very few places have sought to introduce it.