Late Night Levy
Following formal consultation this council adopted the provisions to introduce a late night levy, in accordance with the Police Reform and Social Responsibility Act 2011 and relevant Regulations. The determination to introduce the levy was made by Full Council on 20 September 2017 with an implementation date of 1 January 2018.
The levy is a discretionary power, which the council has adopted. The purpose of the levy is to assist local authorities and the police to manage and improve the night time economy. The Levy will allow the council to charge a fee to businesses that are licensed to sell/supply alcohol between midnight and 6am (00:00 and 06:00 hours). This charge applies whether these licensed (permitted) hours are used or not.
Please see the formal Decision Notice to introduce a Late Night Levy in the London Borough of Tower Hamlets.
The government considers that businesses who are licensed to, and profit from selling/supplying of alcohol between midnight and 6am should contribute towards the costs of managing the night-time economy, rather than relying on other taxpayers in the community to bear the full costs.
There are a number of key issues to note in relation to the introduction of the Late Night Levy. (For clarification purposes references to licence includes Premises Licence and Club certificate).
Date the levy came into effect
1 January 2018.
Hours of operation (i.e. the hours the levy will apply)
The late-night supply period (levied hours) will be from midnight to 6am (00:00 hours to 06:00 hours) everyday.
Levy fee to licence holders
The levy is dependent on the rateable value of the premises and the levy amounts are set by the government:
How much will licensees pay?
|Rateable value||Annual Levy|| Cost per week|
Band A (Nil - £4,300)
Band B (£4,301-£33,000)
Band C (£33,001-£87,000)
Band D (£87,001-£125,000)
Band E (£125,001 and above)
*Those that are band D or E where the main use is the sale of alcohol for consumption on the premises will pay an additional fee.
Premises liable to pay the Levy
The determination of which premises are liable to pay the levy is based on the licensable hours for the sale/supply of alcohol stated on the licence. This means every licensed remises permitted to sale/supply of alcohol (on and/or off sales) between the levied hours (midnight to 6am) will have to pay the levy.
The levy will apply whether the hours for the sale/supply of alcohol detailed in the licence are used or not. For example if a business has a licence, which permits them to sale/supply of alcohol until 2am (i.e. within the levied hours) however the business regularly closes at 11.30pm they will still have to pay the levy. This is the same for if a business has a licence permitting the sale/supply of alcohol for non-standard times that fall within the levied hours, e.g. August Bank Holiday Monday or Christmas Eve until 2am. Whether they are open/using these hours is irrelevant they would still have to pay the levy.
Exemptions from the Levy
The following premises are allowed an exemption:
- Premises with overnight accommodation (this exemption does not apply to any premises which serve alcohol to members of the public who are not staying overnight at the premises)
- Theatres and cinema (this exemption only applies if alcohol is sold during the late night supply period, only for consumption on the premises, to ticket holders, participants in the production or invited guests to private events; they must be bona-fide theatres or cinemas and the sale of alcohol must not be their primary purpose)
- Bingo halls (these premises must have licenses under the Gambling Act 2005 and the playing of bingo must be the primary activity)
- Community Amateur Sports Clubs (these are clubs registered as Community Amateur Sports Clubs that are entitled to various tax concessions including relief from business rates)
- Community premises (these are premises that form part of the church hall, chapel hall, village hall, parish hall, community hall or other similar buildings)
- New Years Eve premises only (this applies to premises which are authorised to sell/supply alcohol between midnight and 6am, and applies only on New Year's Day).
Temporary Event Notices (TENs) and the levy
TENs are exempt from the Late Night Levy because they are not included within the scope of the legislation governing the levy.
The council will give a 30 per cent reduction of the levy for members of business-led best practice schemes.
This reduction will be granted in respect of premises that achieve accreditation in the business led best practice scheme known nationally as Best Bar None (BBN). In this way, the levy will be used to promote and support participation in this scheme. The BBN scheme aims to raise standards in self-regulation and is considered to be beneficial to the management of the late night economy.
For more information on this scheme or to make an application for it please visit www.towerhamlets.gov.uk/licensing.
Collection of the levy
For premises which are liable to pay the levy, the council will collect the levy at the same time as the Licence Annual Fee. However any Licence granted from 1 January 2018 when the levy comes into force, must pay it, 14 days after their licence is granted.
Action the council can take for non-payment of the levy
The money can be recovered as a civil debt, but it would also result in the premises licence being suspended; this scenario would mean that the business could not carry out any licensable activities until the levy has been paid.
Revenue estimated to be gained by the levy
The final amount is difficult to estimate but will depend on:
- how many premises continue to hold a licence during the late night levied hours
- number of premises falling in to one of the permitted exemptions
- number of premises eligible for 30 per cent reduction.
Additionally due to the ability for premises to amend their licensable hours, it is difficult to provide an exact income if the levy is introduced. Theoretically it may range from £20,000 to £350,000 per year subject to all of these variables.
Spending of the levy revenue
The council can recover all costs associated with the administration of the levy system. These are the costs that the council incurs with the introduction or variation, administration, collection and enforcement of the levy.
The amount leftover after the above deductions (the net levy revenue) must be split between the Mayor's Office of Policing and Crime (MOPAC) and the council, on a 70/30 basis, in favour of MOPAC. However MOPAC has agreed that the whole amount will be held in a central trading account. The allocation of this funding will then be managed through our current Community Safety Partnership. This team has responsibility for liaison with the both public and voluntary sector on community safety issues, which will provide transparency and will allow greater flexibility in the use of the funds from year to year.
The council is restricted as to what it can use the funds for; it must be used to fund services to tackle late night alcohol-related crime and disorder and services connected to the management of the night-time economy. The council can only spend the money on the following measure:
- reduction of crime and disorder
- promotion of public safety
- reduction or prevention of public nuisance
- cleaning of any relevant highway or relevant land within the borough.
The Community Safety Partnership will decide how the money will be spent current measures being considered are:
- Taxi Marshalls
- Street Pastors
- Street Cleaning
- Enforcement Initiatives - Night time enforcement officers
- Personal Safety Initiatives
- Health Care Facilities
- Additional Police or private security
- Financial support could be provided to assist schemes that promote improved management of licenced premises, such as Best Bar None or Pub watch
Review of the levy
All aspects of the levy will be reconsidered at least every five years to ensure that the policies are still appropriate.