Small amusement firms are facing an additional “six figure” cost this year, following the government’s increase in NICs, minimum wage and reduction of the business rates discount, with UKHospitality warning “the costs hitting hospitality this month are eye-watering.”

Small UK amusements firms are facing six-figure additions to their outgoings after an increase in NICs and the minimum wage came in alongside a reduction in the business rates discount this month, with UKHospitality warning of “stark” consequences for the sector.

Speaking to ITV, the MD of south east operator Safari Play said the combination of extra costs will mean the company must find “a six figure sum” from its existing revenue stream without passing the burden onto its customers.

“We’ve got the business rates to start off with, the discount for that is half so that’s going to be £35,000 to £40,000 extra compared to last year for a building of this size,” said Safari Play MD Gordon Foster.

“Then we’ve got the National Insurance and the minimum wage and that combined could be £60,000 to £70,000. So we’re looking at a six figure sum for a small family-run business.”

According to UKHospitality, the sector faces an additional £1.9bn in wage costs, £1bn in employer NICs, and £500m in business rates, after relief was lowered from 75 percent to 40 percent, with 70 percent of firms now looking to reduce their workforce in response.

“The costs hitting hospitality this month are eye-watering, and the impacts it will have on businesses, teams and communities are stark,” said CEO Kate Nicholls. 

“I urge the Government to work with us to bring forward a plan for hospitality that addresses these issues and backs the sector to serve Britain and create places where people want to live, work and invest.”