BrewDog has cautioned that the UK brewing and hospitality industry has faced a £1bn rise in costs over the past year, with soaring energy, labour, and raw material expenses putting mounting pressure on brewers and pub operators ahead of the Autumn Budget.
The Scottish brewer said that soaring energy bills, rising National Insurance contributions, increased wages, and a series of new taxes and packaging regulations have forced breweries and pub groups to make “difficult decisions” to safeguard their futures.
BrewDog further estimated that the industry would need to sell an additional 950,000 pints every hour to compensate for the rising costs.
“In the past year alone, energy, wages, National Insurance, raw materials, packaging and regulatory costs have all moved in the wrong direction,” said chief executive James Taylor.
“Taken together, these increases have added more than £1 billion to the sector’s collective bill.”
The company recently revealed plans for targeted job reductions, the closure of several UK bars, and the sale of its Lost Forest estate in Scotland as part of a strategy to streamline operations and concentrate on its core beer and bar business.
Taylor called on the Government to provide substantial relief in next month’s Budget through reforms to business rates, beer duty, and temporary VAT support for the hospitality sector, warning that “many independent brewers and pub operators will simply not be able to withstand the pressure” if costs keep climbing.
He also highlighted international examples, such as Ireland’s plan to reduce hospitality VAT from 13.5% to 9% starting July 2026, as a model of the type of support required to protect the industry.
Emma McClarkin, Chief Executive of the British Beer & Pub Association, echoed BrewDog’s concerns, saying: “This analysis reinforces the cumulative impact of the huge barrage of costs the industry has had to cope with. We urge the Chancellor to act by cutting beer duty and reviewing punishing employment and packaging costs so we can thrive at the heart of high streets and communities across the UK.”
Taylor added: “Britain’s brewing heritage is something to be proud of. With the right policy environment, this sector can be a powerhouse for jobs, growth and creativity.”