UK Hospitality warns sector faces being taxed out
UK Hospitality has warned the Prime Minister that hospitality is in danger of being taxed out, with the sector having lost 69,000 jobs since the Budget.
The organisation has called on the government to extend the existing exemptions to NIC to include both young people and those moving from welfare into work.
In a letter to the Prime Minister, UK Hospitality said the 2024 Budget directly contributed to a reversal in the sector’s ability to create jobs, and between October 2024 and May 2025 the sector lost 69,000 jobs. In the same period the previous year, hospitality created an additional 18,000 jobs.
The letter said that this year’s Budget should explicitly aim to reverse the hospitality job losses of the past few months.
In the run-up to the next Budget, UK Hospitality is also calling for the government to: lower business rates to revive high streets, through the maximum discount of 20p for hospitality businesses as part of the promised business rates reform; and cut VAT on hospitality to drive investment by following the majority of European rival nations.
Speaking about the proposals, Kate Nicholls, chair of UK Hospitality, said: “In the years following the financial crisis we created one in five net new jobs and today employ 3.5 million people. The government needs sectors like hospitality to create jobs and meet their ambition to get more people back into work.
“We have a proven track record of being able to deliver those jobs in every part of the country and for people from all backgrounds.
“The NICs change was socially regressive and had a disproportionate effect on entry-level jobs. Without a change of tack from the government we could be looking at over 150,000 fewer workers in hospitality, when we should be bringing people into the jobs market.
“The economy needs jobs. Hospitality creates them. But we are being taxed out.”
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