VAT cut campaign supported by Welcome to Yorkshire
Hospitality and tourism bodies have called for a permanent VAT reduction following a study that suggests a permanent reduction could save £4.6bn and create over quarter of a million jobs over the next decade.
The report commissioned jointly by The British Beer and Pub Association, UKHospitality, the Tourism Alliance and the Association of Leading Visitor Attractions, found that a permanent rate of 12.5% VAT will bring UK hospitality and attractions in line with the European average and stimulate further investment and growth.
Headline results from the analysis of the impact of retaining VAT at 12.5%, rather than returning to 20%, for hospitality and tourism include:
- Creating 286,850 jobs over 10 years
- Generating £7.7bn of additional turnover over 10 years
- Delivering £4.6 billion in net present value of fiscal gains to the HM Treasury over 10 years -
- Returning a positive gain on the Government’s investment in less than 5 years.
Responding to the findings, Peter Box CBE, Chair of Welcome to Yorkshire, said:
"A recent survey carried out in partnership with the Tourism Alliance found that 55% of tourism and hospitality businesses in Yorkshire have access to less than two months of cash reserves.
"Times remain incredibly tough and with rising costs taking increasing amounts out of disposable incomes, there are uncertain months ahead as we recover from the pandemic.
"Welcome to Yorkshire has been consistent in our calls for additional targeted support for the region’s tourism and hospitality sector which is so critical to Yorkshire’s economic success, and I commend the Government for the help they have given so far.
"Raising VAT above the current 12.5% rate would be catastrophic for these businesses on top of the many other challenges they face. I support measures to avoid any increase and call on the Government to take a close look at the findings presented by the industry."