New campaign calls on Chancellor to "lock in" low VAT permanently to encourage hospitality and tourism

Thursday, October 7, 2021

UK Hospitality has announced a new # VATsEnough campaign targeting the very poor.

#VATsEnough campaign follows rise in VAT on catering and tourism to 12.5% on 1 October.

While last year's landmark Ministry of Finance decision to lower VAT on these sectors helped many venues weather the crisis, on current plans, VAT will rise back to its pre-pandemic level of 20 percent in April 2022, at the precise time that the peak season begins next year.

The trade association are now urging customers, suppliers, restaurants and staff to remind people of the need for the 12.5 per cent VAT rate to be introduced for local pubs, bars, restaurants, hotels and other firms in the sector.

A new YouGov poll for UKHospitality finds that six out of 10 (57%) of adults believe that VAT rates on accommodations should not rise to 20% next year, while seven out of 10 (70%) believe that the government has a responsibility to support the sector's recovery.

Crucially, the survey found that half (49%) of adults believe that if prices were increased in restaurants, pubs and cafés they could eat fewer meals.

Kate Nicholls, director of UKHospitality said: "We're launching the #VATsEnough campaign because a failure to act risks the future of hotels, cafés, pubs, restaurants and myriad other venues and attractions across the country. Our businesses bring light, life and heart to communities across the country but are battling huge challenges in terms of labour shortages and the food supply chain after 18 months of desperate struggle due to the pandemic.

Nick Mackenzie, chief executive of the pub business Greene King, added: "The VAT reduction has helped the hospitality sector stay afloat during the last 18 months, but we are facing continued long-term challenges. At Greene King, we have around 2.800 pubs in communities of all sizes and types, and making 12.5% VAT permanent will allow us to plan, invest, as well as create jobs across the country and support the government's levelling up agenda."