Government urged to lower hospitality VAT as majority of pub licensees back campaign

By Helen Gilbert

- Last updated on GMT

Related tags: Alcoholic beverage

96 per cent of licencees say they sector should campaign to reduce the level of VAT on food and drink
96 per cent of licencees say they sector should campaign to reduce the level of VAT on food and drink
The pub and restaurant industry is being urged to call on the Government to introduce a reduction in the level of VAT paid on food and drink.

Of 1003 pub licensees polled in a survey commissioned by industry lobbying organisation VAT Club Jacques Borel, 96 per cent said the sector should campaign to reduce the level of VAT on food and drink from 20 per cent to five per cent – the same amount paid by supermarkets.

The survey, which interviewed licensees from a mix of free house, leased tenanted, franchised and managed pubs, found that 86 per cent felt it unfair that supermarkets do not pay VAT on food while pubs have to.

In addition, 82 per cent agreed that the tax break on food helped supermarkets subsidise drinks, while an overwhelming 92 per cent of licensees believed a VAT tax reduction on food would allow them to reduce prices and attract more customers.

“The findings of this important survey clearly emphasise the fact that licensees across the UK wholeheartedly back the vital campaign to reduce the level of VAT on food and drink in pubs and restaurants,” VAT Club JB chairman, Jacques Borel said.

“It also highlights the fact that individual licensees back the VAT Club JB and believe that if the campaign is successful, it will have a positive effect on their business.

“The clear message to Government and individual MPs of all political parties is that the VAT campaign is of great importance to licensees and the pub industry.”

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1 comment

Get the facts straight

Posted by W Neale,

If the VAT club expects to be taken seriously by the Government, it must get the facts right, or it looks foolish. If supermarkets sell hot food or food consumed on the premises, they charge VAT at 20% in just the same way as pubs. As far as I am aware, you can't buy your milk, bread, eggs and meat from a pub, which are all free of VAT (not taxed at 5% because they are staple foods, uncooked). Comparing the two is not comparing equals.

Supermarkets use booze as a loss leader, to encourage food sales, something pubs could do if the brewery companies were not so greedy in their pricing.

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