Whitbread, the FTSE 100 leisure group, has announced a 22% decline in pre-tax profits for the first half of the year, reflecting softer demand in the UK market. The company reported flat revenues of £1.57 billion for the six months ending August 29, with pre-tax profits dropping to £309 million. A notable factor in this downturn was a 7% decline in food and drink sales, attributed to a major restructuring of its restaurant operations.

Despite these challenges, Whitbread has reaffirmed its full-year guidance and remains optimistic about a potential recovery in the second half of the year. The company noted an increase in bookings for October and November, suggesting a rebound in consumer confidence.

As part of its growth strategy, Whitbread is focused on expanding its room capacity. The company plans to increase Premier Inn’s UK room count from 86,000 to 98,000 and double its presence in Germany from 10,500 to 20,000 rooms. To facilitate this expansion, Whitbread has accepted offers for 51 of the 126 restaurants it intends to sell. Additionally, plans are underway to convert 112 more restaurants into approximately 3,500 hotel rooms, with planning applications already submitted for a third of these new rooms.

The restructuring plan, which is expected to cost £500 million over the next four years, is reportedly “on track,” according to the company. Notably, Whitbread’s German operations have experienced a 21% revenue boost, driven by what the company describes as the “progressive maturity” of its hotel estate in that market.

Chief Executive Dominic Paul, who took the helm from Alison Brittain last year, expressed confidence in the company’s growth plans. “We are making excellent progress with our plans, and over the next five years, we are set to deliver a step change in our performance, which will fund significant returns to shareholders,” he stated. He emphasized a clear pathway for extending Whitbread’s market-leading position in the UK and capitalizing on favorable supply conditions.

As part of its commitment to returning value to shareholders, Whitbread has announced an interim dividend of 36.4p per share and a £100 million share buyback program. Founded in 1742 as a brewery by Samuel Whitbread, the company has undergone significant transformations over the years, selling its brewing business in 1999 and shifting its focus to hospitality. In 2019, Whitbread divested its Costa Coffee chain to Coca-Cola for £3.9 billion and has since expanded into the German market, which remains a crucial area for growth.

Following the announcement, Whitbread shares rose by 3.6%, or 111p, to £31.83, reflecting investor confidence in the company’s future prospects.

The Social Market Foundation (SMF) has released a report recommending a substantial increase in the Remote Gaming Duty from the current 21% to 42%. This proposed change could potentially generate up to £900 million for the UK Treasury, as the country grapples with a £22 billion fiscal shortfall.

The report, authored by Dr. James Noyes and Dr. Aveek Bhattacharya, highlights the increasing financial burden associated with online gambling, particularly in the realm of casino gaming, which has been linked to heightened rates of gambling-related harm. Fiscal costs associated with this issue are estimated to exceed £1 billion, prompting calls for a reevaluation of how the sector is taxed.

The authors argue that the online gambling sector is currently undertaxed compared to its counterparts in other countries, where operators face higher tax rates. They contend that the UK government has a significant opportunity to modernize its outdated tax system while addressing the social costs tied to gambling, including addiction and related health issues.

In recent years, the surge in online gambling, accelerated by the pandemic, has raised concerns about its impact on public health. Many experts believe that the current tax framework does not adequately reflect the economic and social implications of the industry. By increasing the Remote Gaming Duty, the government could not only bolster public finances but also invest in programs aimed at mitigating gambling-related harm.

The report emphasizes that the increased tax revenue could be earmarked for initiatives designed to support those affected by gambling addiction, funding education and treatment programs, and improving resources for gambling harm prevention.

Critics of the current tax structure argue that the existing rates do not align with the industry’s rapid growth, leading to a disconnect between the benefits enjoyed by operators and the social costs incurred by society. The SMF’s recommendations aim to bridge this gap by ensuring that the online gambling sector contributes its fair share to the economy while addressing the negative consequences of its activities.

As the government seeks to address its fiscal challenges, the SMF’s report may serve as a catalyst for discussions about reforming gambling taxation. With the potential to generate substantial revenue while prioritizing public health, the proposal could reshape the landscape of online gambling in the UK for years to come.

As stakeholders from various sectors weigh in on the report’s findings, the debate over how best to regulate and tax the online gambling industry is set to intensify, highlighting the complex interplay between economic opportunity and social responsibility.

Emmanuel School in Derby, the Branch Christian School in Yorkshire, and the King’s School in Hampshire have joined forces with concerned parents to challenge the UK government’s proposed Value Added Tax (VAT) on school fees. The claimants argue that the tax discriminates against faith-based schools and families, potentially making Christian education unaffordable and threatening the viability of many institutions.

In a letter addressed to the government, the schools and parents assert that the VAT imposition breaches human rights laws and fails to adhere to legal standards. They describe the decision to impose VAT on education—historically exempt from such taxes in the UK—as unprecedented and unjust. Their legal team contends that this policy disproportionately affects Christian schools, which typically operate on tighter budgets and charge lower fees compared to larger independent schools.

The claimants further argue that the VAT policy infringes upon anti-discrimination rights outlined in the European Convention on Human Rights, which is integrated into UK law through the Human Rights Act 1998. Caroline Santer, headteacher at the King’s School, criticized the government’s proposal as “ill thought out,” emphasizing that families who opt for faith-based education often forego other luxuries, including holidays and extracurricular activities, to afford tuition.

Parents like Stephen White voiced concerns that the new tax could force them to resort to homeschooling their children, as they are unwilling to enroll them in secular state schools. “It’s an impossible situation,” White said. “We want our children to have a Christian education, but this tax could make that impossible.”

Andrea Williams, chief executive of the Christian Legal Centre, which is supporting the legal challenge, echoed these sentiments. She warned that the VAT charge would make independent faith-based schooling unaffordable for many families and could lead to the closure of smaller faith-based schools.

This legal challenge arises amid broader criticism of the VAT policy from education unions and private school associations, which have urged Chancellor Rachel Reeves to postpone the tax’s implementation scheduled for January. Despite the mounting pressure, the government remains steadfast in its commitment to the tax, asserting it will generate £1.5 billion to bolster state education and hire 6,500 new teachers.

The situation reflects a growing concern regarding the implications of the VAT on school fees for faith-based and smaller independent schools. The Treasury has been contacted for comment but has yet to respond to the unfolding controversy. As the legal challenge progresses, the future of Christian education in the UK hangs in the balance.