Report

Last orders

This report from UK think tank the Adam Smith Institute recommends a shift toward a pro-growth, framework to ensure that Britain’s nightlife remains a global attraction.

The report Last Orders, co-authored by Sacha Lord and the Adam Smith Institute, highlights the precarious state of Britain’s hospitality and night-time economy. It argues that the sector—once a thriving pillar of community life and a major employer—is being driven to the brink by a “perfect storm” of rising costs and an outdated, punitive tax system. With thousands of pubs, restaurants, and clubs closing their doors permanently, the analysis suggests that the current fiscal framework is actively hostile to entrepreneurship.

The report contends that the industry is not seeking permanent subsidies, but rather a ‘hand up’ through meaningful structural reform that acknowledges the unique pressures of the post-pandemic, high-inflation landscape. A central theme of the research is the disproportionate tax burden carried by hospitality businesses compared to other sectors.

The report calls for an urgent reduction in VAT for the sector, pointing out that the UK’s rate is among the highest in Europe, which stifles investment and forces price increases onto struggling consumers. Furthermore, the ‘broken'”‘ Business Rates system is identified as a primary catalyst for high-street decline, penalising physical venues while failing to account for the shift toward digital commerce. By failing to reform these archaic levies, the Government is effectively presiding over the managed decline of the “Great British Pub” and the wider night-time economy, losing vital tax revenue and cultural capital in the process.

Beyond taxation, the report critiques the ‘nanny state’ regulatory environment, such as the Late Night Levy and restrictive licensing laws, which treat hospitality as a nuisance rather than an economic asset. The Adam Smith Institute advocates for a liberalised approach that empowers local operators and encourages growth rather than stifling it through bureaucratic red tape.

The conclusion is clear: if the Government continues to view hospitality as a ‘cash cow’ to be milked through taxation and hampered by regulation, the ‘last orders’ bell will ring for many more cherished institutions. A shift toward a pro-growth, deregulated framework is essential to ensure that Britain’s nightlife remains a global attraction and a vital driver of economic dynamism.