Caterer & Hotelkeeper has launched a major new campaign - Slash VAT, Boost Business - aimed at easing the burden of taxation on UK hospitality operators.
We've decided to take action because the UK has the second-most uncompetitive rate of VAT for hospitality businesses in Europe. France's rate is just 5%. In Germany hotels enjoy a rate of 7%, in Spain it's 8%, and in Ireland it is 9%.
We think 20% is too high and that hospitality, as a major force in the UK economy, could help kickstart the recovery and create jobs if given the right conditions to thrive.
This thread is the forum for you to air your views on VAT. You may want to:
We look forward to hearing from you!
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www.twitter.com/slashVAT
Am totally in support of helping the hospitality industry help to pull this country out of its recent problems.
9% to me is fair - this aligns with Ireland, although, somewhere between France and Germany would be perfect. 17.5% is a waste of time.
Working with other hospitality lobbying groups would make sense...not necessarily to produce "one voice", but to ensure the Government does not get a split view from different parts of the industry, and use this as an excuse do do nothing!
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Anthony Lloyd
Fallowfields Hotel and Restaurant, Oxfordshire
www.fallowfields.com
Thanks for the comments fallowfieldsuk. Anyone else out there have an opinion?
News just in on VAT:
The weight of calls for a VAT cut for hospitality is growing, with the Federation of Small Businesses this week asking Government for a year-long VAT reduction to 5% for tourism and construction to help boost the economy.
The call comes after indications that business confidence has fallen dramatically.
You can read the full details of the FSB's call here on their website:
http://www.fsb.org.uk/news.aspx?REC=7201
If you own and run a small business do you think a year-long cut would have a marked effect? Is it long enough? Is 15% low enough? Do you think it would be worth the impact a potentially reduced tax take would have on the Government's coffers?
From Alain Lhermitte owner of Mon Plaisir - Family run and oldest French restaurant in Covent Garden celebrating its 70th anniversary next year
'Completely agree it should be reduced. There are a lot of French policies I disagree with and the reason why I moved to the London to open my restaurant, but reducing VAT from 20% to 5% in France was a complete life line to so many small and independently run restaurants there. If I had not bought the freehold at Mon Plaisir back in 1976, despite being a successful restaurant, I would have folded years ago. Competition is fierce and more and more independently run restaurants are forced out of business; this isn't right and something must be done before we end up surrounded by clone and characterless restaurants. With electricity, gas and other bills rising, a VAT cut ideally to 10% would make the world of difference to me and thousands of others.'
http://www.monplaisir.co.uk
Thanks very much for this comment Alain. I understand from the Federation of Small Businesses that not only was the French reduction a helpful move for business, it also had a beneficial effect on the economy in general. According to a recent study of the effects of the cut in France, it emerged that the tourism and leisure sector got a boost, and VAT fraud fell by 74%, increasing tax receipts from the black economy. I think this is definitely an example of where we can learn from our friends across the Channel.
As I learn more about this critical issue to both the hospitality and the construction industries, I am increasingly coming to believe we should be going for broke and pushing for 5%.
The 2Q slowdown in confidence together with the beneficial evidence upon their economies from France and other Europeans says to me #let'sdoit
There does appear to be a strong case for 5% (sorry for the slow reply, I was on hols) - hopefully I will be able to expand on this in a forthcoming issue of Caterer.
I am intrigued, nay amazed, that this issue hasn't , if measured by the number of responses to this thread, generated much interest.
How is the campaign going generally?
I have just come across this HM Treasury petition. I have underlined their words in italics and included a link to the petition itself. Responsible department: Her Majesty's Treasury The Publican's Morning Advertiser is calling for the Government to reduce VAT to 5% for the hospitality sector. 21 countries in the EU have a lower VAT rate for the hotel sector and 13 for the overall hospitality sector. In France, tax was reduced from 19.65% to 5% and led to the creation of 21,700 jobs in the first year. A cut in VAT could help create 320,000 jobs in the post Olympic years and help save pubs, restaurants and hotels. http://epetitions.direct.gov.uk/petitions/1198
I have just come across this HM Treasury petition. I have underlined their words in italics and included a link to the petition itself.
Responsible department: Her Majesty's Treasury
The Publican's Morning Advertiser is calling for the Government to reduce VAT to 5% for the hospitality sector. 21 countries in the EU have a lower VAT rate for the hotel sector and 13 for the overall hospitality sector. In France, tax was reduced from 19.65% to 5% and led to the creation of 21,700 jobs in the first year. A cut in VAT could help create 320,000 jobs in the post Olympic years and help save pubs, restaurants and hotels.
Hi Anthony
Thanks for your support. The campaign is progressing with plenty of letters and emails from people pledging their support for the VAT campaign coming in (you may have seen some of them in the pages of Caterer). We are also building a decent following on Twitter, although we could always do with more so please do continue to mention Slash VAT in your tweets.
Thanks for the link too. As it happens, we currently have a submission for a very similar petition pending on the epetitions site. Unfortunately it can take up to seven days to get them approved and we have not yet heard back from the epetitions team. As soon as we get a petition up and running we would be grateful if you can get the message out to as many people as possible!
I'd be delighted to Neil. Just let me know.