Unless you’ve been living off grid, you won’t have failed to notice the #VATsTheProblem campaign, being spearheaded by chef and restaurateur Tom Kerridge calling for VAT on hospitality to be cut from 20% to 10%. Kerridge has become a self-appointed spokesman for the industry in recent years, highlighting the plight of pubs and restaurants to his consumer base, and he has now turned his attention to VAT.
The cynic in me would usually suggest that the industry needs yet another petition calling for lower VAT as much as much as Big John needs another Chinese takeaway - this latest is just one of a number of petitions to put forward the case over the past couple of years - but the timing of this one seems altogether more significant. A few weeks back the Government announced that it would reduce VAT on children’s meals over the summer, and while this wasn’t met with much enthusiasm by the industry at large, deputy editor Joe Lutrario argued that it was a concession by the Government that hinted that it was willing to look more closely at the issue of VAT than previously thought.
The timing of the #VATsTheProblem campaign then will be a good way of testing this notion further. Now almost 200,000 people have signed the petition and it has gained traction, being raised in the Commons at Prime Minister’s Questions this week. While Keir Starmer shrugged off any idea that the Government would do more, pointing instead to the business rates relief for pubs and the temporary VAT cut on children’s meals that the Government has introduced, there is a feeling among some people that Number 10 could be in favour of a cut and that the move on children’s meals might be testing the water for bigger things.
Governments don’t traditionally like petitions, but there is a strong and salient argument behind cutting VAT in hospitality that it is finding increasingly hard to ignore. Reducing VAT to 10% is by no means radical and would merely bring the UK more closely in line with many European countries, where hospitality businesses benefit from lower rates. Restaurants in France and Germany, for example, pay VAT rates of around 7%, while Spain and Italy apply rates of 10%. In the Republic of Ireland, prepared food and dining services are currently subject to a reduced VAT rate of 13.5%, which is due to fall to 9% from 1 July.
But campaigns like this live or die on momentum and more people need to keep adding their voices so that the issue stays front of mind and reaches more and more eyeballs. The ultimate aim is to get one million signatures once the consumer campaign goes live in July, but the industry needs to continue to do its bit ahead of this to give its the best chance possible to hitting this target. Momentum has slowed, so a second wind is required. As Simon Rogan said this week: “We need to keep the momentum going. So if we all stand together we can make a real difference.”
Rather than screaming into the void, this petition has timing on its side and the potential to herald real change. If you haven’t already signed the petition then you can so here - www.vatstheproblem.co.uk. This time round let’s see if we can make it count.