Asked by: Cherilyn Mackrory (Conservative - Truro and Falmouth)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has any plans to extend the VAT reduction for hospitality businesses beyond April 2023.
Answered by Victoria Atkins - Secretary of State for Health and Social Care
The temporary reduced rate of VAT was introduced on 15 July 2020 to support the cash flow and viability of around 150,000 businesses and protect over 2.4 million jobs in the hospitality and tourism sectors, which were severely affected by COVID-19. The relief, which ended on 31 March 2022, cost over £8 billion.
All taxes are kept under review, but the Government has been clear that this was a temporary measure in response to COVID-19. It was appropriate that as restrictions were lifted and demand for goods and services in these sectors increased, the temporary VAT relief was first reduced and then removed in order to rebuild and strengthen the public finances.
Asked by: Cherilyn Mackrory (Conservative - Truro and Falmouth)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment his Department has made of the potential effect on critical mineral production of ending of the red diesel rebate in April 2022.
Answered by Helen Whately - Minister of State (Department of Health and Social Care)
Following consultation in 2020, the Chancellor confirmed at Spring Budget 2021 that the Government will remove the entitlement to use red diesel from most sectors from April 2022. This will more fairly reflect the negative environmental impact of the emissions they produce and help to ensure that the tax system incentivises the development and adoption of greener alternatives.
The Government did not believe that the cases made by sectors that will not retain their red diesel entitlement outweighed its environmental objectives. The Government recently announced the £40 million Red Diesel Replacement Competition to support the development and demonstration of low carbon alternatives to red diesel for the construction, and mining and quarrying sectors.
Going forward, the Government will publish a UK Critical Minerals strategy in 2022, setting out its approach to securing technology-critical minerals and metals.