Hospitality leaders urge VAT to be held at 12.5 percent
SOME 261 business leaders have urged the Government to keep VAT at 12.5 percent to help hospitality and leisure firms recover.
Writing to Chancellor Rishi Sunak, they warn that April's planned rise to 20 percent will "exacerbate the squeeze on household finances". They say customers are feeling the pinch from increasing costs while firms face higher prices for labour, energy and supplies. As a result, a "reduced rate is ever more important", they said.
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A major concern of the impact of theVAT rise is that many firms will have no choice but to significantly raise their prices, they note. They also fear that April may be a "cliff edge" across the sector, as the duty rise will coincide with a national minimum wage increase, plus changes to business rate relief and an end to the rent moratorium.
UK Hospitality chief executive Kate Nicholls said theVAT level is "vital, in the interests of competitiveness, job creation, growth and ensuring hospitality and tourism play their part in the economic recovery".
