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Cuts and extensions vital for future of hospitality

Published:  20 November, 2020

Extending the VAT cut and the business rates holiday are top priorities for the hospitality sector if businesses are to survive beyond the winter, according to new research by CGA for UK Hospitality, the British Beer and Pub Association and the British Institute of Innkeeping. 

In the survey of over 400 different businesses which operate more than 20,000 venues across the UK, over half said an extension of the government’s business rates holiday was “crucial to their survival”.

Four in 10 also stated that the government needed to extend its VAT cut to beyond March to help their businesses remain viable, while one in four felt that enhanced grants to enable them to meet at least some of their costs whilst closed, was “vital to their survival”.

The research also pointed to a cut in beer duty being crucial, with over one-third of brewers stating it should be a government priority upon reopening, as did one in five pubs.

The research follows a survey released yesterday that suggested that three quarters of hospitality businesses could close in 2021

The trade bodies said it was now “vital” for the government to “deliver this urgent support the sector requires to help ensure its very survival”.

“Slashing hospitality VAT and introducing a business rates holiday for the sector were critically important moves earlier in the crisis. They eased the financial burden on businesses and boosted trade at a time when the sector needed all the help it could get,” the trade bodies said in a joint statement.

“But with 72% of hospitality and pub businesses fearing they could close in 2021, they still need more support now. Many businesses are only just clinging on, so the VAT cut and rates holiday must be extended as a priority. In the immediate term extending grant support is crucial.”

For pubs and brewers especially, a cut in beer duty was also needed on top of VAT and rates support, the statement said.









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