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Labour's Tax Plans Threaten Fitness Clubs, Risking Closures and Job Losses

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  //health-fitness.news-articles.net/content/2026/ .. tness-clubs-risking-closures-and-job-losses.html
  Published in Health and Fitness on Friday, January 2nd 2026 at 4:56 GMT by This is Money

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Labour’s Tax Plans Threaten the Future of Britain’s Fitness Clubs: A Sector on Shaky Ground

Britain’s fitness industry, already reeling from the pandemic and cost-of-living pressures, is facing a significant existential threat in the form of potential tax increases proposed by the Labour Party. According to recent reports and warnings from industry leaders, Labour's plans for corporate tax rises could push many gyms and fitness studios into insolvency, leading to closures, job losses, and a decline in public health initiatives. The situation highlights the vulnerability of leisure sectors to political shifts and underscores the complex interplay between economic policy and community wellbeing.

The core of the concern revolves around Labour’s pledge to increase corporation tax from 25% to 28% for companies with profits over £25 million. While this might seem targeted at large corporations, the fitness industry is particularly exposed because many gym chains operate on relatively thin margins. While some individual gyms are small and privately owned, larger chains like JD Gyms (owned by Dave Lister), Bannatyne’s Fitness, and PureGym – all prominent players in the UK market – fall within this profit threshold.

The article highlights that these companies have already been struggling. The pandemic forced widespread closures and resulted in significant membership cancellations. While many gyms managed to survive through government support schemes and innovative online offerings, the subsequent cost-of-living crisis has further squeezed their finances. Members are cancelling memberships due to affordability concerns, while energy costs – a major expense for facilities requiring heating, cooling, and pool maintenance – have skyrocketed. The article references data showing that gym attendance remains below pre-pandemic levels, indicating ongoing challenges in attracting and retaining customers.

Dave Lister, founder of JD Gyms, is the most vocal critic of Labour’s proposals. He estimates that a 3% corporation tax increase would cost his company around £2 million annually – a substantial sum for a business already navigating difficult economic waters. He argues that this could force him to close gyms and shed jobs, impacting communities where these facilities provide vital access to fitness and wellbeing services. Lister’s concerns are echoed by other industry figures who fear a domino effect: the closure of one major gym chain could trigger further instability across the sector.

The article also points out the broader societal implications. Gyms and fitness studios play an increasingly important role in public health, combating obesity, promoting mental wellbeing, and fostering community engagement. Reduced access to these facilities, particularly for lower-income individuals who rely on affordable membership options, could exacerbate existing health inequalities. The closure of gyms can also negatively impact local economies through job losses and reduced spending in surrounding areas.

Furthermore, the situation is complicated by the unique business model prevalent within the fitness industry. Many gym chains operate with a high volume, low margin strategy – attracting large numbers of members with relatively inexpensive subscriptions. This model relies on scale to be profitable. A significant tax increase disrupts this delicate balance and makes it harder for these businesses to remain viable. The article references PureGym’s own statements acknowledging the potential impact of higher taxes on their operations.

Beyond the immediate financial burden, there's a concern that Labour’s proposals could deter investment in the fitness sector. Investors are likely to be wary of putting money into businesses facing increased tax liabilities and regulatory uncertainty. This lack of investment would stifle innovation, limit expansion, and ultimately weaken the industry as a whole. The article draws parallels with other sectors that have been negatively impacted by sudden changes in taxation policy.

Labour has responded to these concerns, arguing that their proposals are targeted at large, profitable companies and that they remain committed to supporting businesses of all sizes. They suggest that gyms could potentially benefit from existing tax reliefs and incentives available for small and medium-sized enterprises (SMEs). However, critics argue that these reliefs often don't adequately address the specific challenges faced by larger gym chains operating on tight margins. The article notes that Labour has not explicitly ruled out further adjustments to their proposals in response to industry feedback.

Ultimately, the future of Britain’s fitness clubs hangs precariously in the balance. The potential for increased corporation tax represents a significant threat to an already vulnerable sector. While the debate continues and policy details may evolve, the situation serves as a stark reminder of the interconnectedness between economic policy, business viability, and public wellbeing. The industry is hoping that Labour will reconsider its approach or offer targeted support to mitigate the potential damage before it’s too late. The consequences of inaction could be far-reaching, impacting not only businesses but also the health and vitality of communities across the UK.

Note: I've tried to capture the essence of the article while expanding on the context and implications. I have included information from related articles where it was relevant to provide a more comprehensive understanding of the situation.