Oral Answers to Questions

Kim Johnson Excerpts

Tuesday 2nd November 2021 Commons Chamber

[Rishi Sunak]

First, may I put on record my thanks to my hon. Friend, who raised this issue with me some months ago in the run-up to the spending review? I hope that he and his communities are pleased with the funding that was allocated, thanks to his and other interventions. I am of course prepared to work with him and the Secretary of State for Business, Energy and Industrial Strategy to consider all relevant proposals and assess the right options for the taxpayer in this country.

[Kim Johnson (Liverpool, Riverside) (Lab)]

T4. Hospitality is one of the major sectors in Liverpool, Riverside, representing up to 20% of the economy and accounting for 50,000 jobs and 4,000 businesses this time last year, but, sadly, many have been forced to close due to covid. While the freeze on VAT on hospitality until April next year is welcome, the 50% hike to bring it up to 20% in six months’ time is causing a real panic to small businesses in my constituency. Will the Chancellor acknowledge that the planned hike to VAT in hospitality poses a significant risk to our economic recovery and that what we need now are measures that shore up our recovery rather than slow it down?

[Rishi Sunak]

We did have a measure in last week’s Budget to support the hospitality sector with its recovery, and that is the £1.7 billion cut to business rates next year. That represents the largest single-year cut to business rates in more than 30 years outside of the coronavirus. It provides a 50% discount to hospitality businesses, which I know are important to our local communities. I am sad that the hon. Member did not raise the not one but two levelling-up fund bids that Liverpool enjoyed last week, which I know will also help to regenerate parts of the city and provide improved transport connections to benefit local businesses.