ANGRY publicans have accused City of Sydney council of declaring war by red tape with its latest moves to reduce the number of late-night drinking spots.

The council proposes changes that will increase its powers to close bars at midnight.

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But bar owners and restaurateurs argue it is an attempt to ''shut down the city'' at midnight and hobble their businesses through a lack of certainty over trading hours which will cost them millions.

The council says the proposed amendments are aimed at balancing the interests of residents with the needs of revellers.