Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps he is taking to support the hospitality industry; and if he will make an assessment of the potential merits of reducing VAT for that industry.
At Autumn Statement 2023, the Government announced a package of business rates changes and tax cuts, including extending the Retail, Hospitality and Leisure relief scheme at 75 per cent, up to a cash cap of £110,000 per business for 2024-2025. This is tax cut worth almost £2.4 billion for around 230,000 properties.
VAT is the UK's third largest tax forecast to raise £173 billion in 2023/24, helping to fund key spending priorities such as important public services, including the NHS, education and defence. The previous VAT relief for tourism and hospitality cost over £8 billion and reintroducing it would come at a significant further cost.
While there are no plans to reduce the rate of VAT paid by hospitality businesses, the Government keeps all taxes under review.