Hospitality Industry and Tourism: VAT

(asked on 9th March 2021) - View Source

Question to the HM Treasury:

If his Department will make an assessment of the potential merits of making permanent the five per cent reduced rate of VAT for the tourism and hospitality sector.


Answered by
Jesse Norman Portrait
Jesse Norman
This question was answered on 9th March 2021

The temporary reduced rate of VAT was introduced on 15 July to support the cash flow and viability of about 150,000 businesses and to protect over 2.4 million jobs in the hospitality and tourism sectors. As announced at Budget, this relief will now run until 31 March 2022, with a staggered return to the standard rate. Applying this relief permanently would come at a significant cost to the Exchequer, and that cost would have to be balanced by increased taxes elsewhere, or reductions in Government spending.

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