Late last year saw a boost for nightclubs in London and the North East, but other regions and cities in the UK suffered continued decline. Since March 2020, there has been a 32.7% drop in the total activity of the UK’s nightclub sector. This equates to a loss of 405 venues, with the number of nightclubs decreasing from 1,240 in March 2020 to just 835 in November 2024.
Following last year’s autumn budget, nightclub operators will soon face reduced business rates relief, and an increase in duty, employers’ National Insurance contributions and wage increases.
As a result, the NTIA has called for the government to introduce tax relief in the spring budget to alleviate strain on the sector. The organisation said that the sector needs a balanced and proportionate budget, and that a VAT cut must be part of the solution – without these there could be further closures, job losses and long-term damage for the sector and the economy.
“While we’ve seen some recovery during the Golden Quarter [holiday season between October and New Year], the reality is that our sector is still deeply fragile. We’ve already lost hundreds of businesses across the night time economy, who are struggling with unsustainable cost increases, including soaring energy prices and significant increases in wages, national insurance contributions, and duties,” commented Michael Kill, chief executive of the NTIA.
“The additional financial burden from the planned tax increases in April 2025 could drive many more businesses to the brink of closure. Operators are working on fine margins, and many have exhausted all possible avenues to cut costs.
“The uncertainty heading into 2025 is more concerning than anything we saw during the pandemic. The Chancellor must step up with considered support to help businesses survive and protect jobs. The long term strategy rhetoric is important, but there must be a recognition and consideration for the immediate challenges, which are substantial, as we risk further closures and job losses. This environment for many is unsustainable.”