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Hospitality leaders urge Rishi Sunak not to raise VAT rate in his fall budget

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Hospitality leaders urge Rishi Sunak not to raise VAT rate in his fall budget as industry recovers from Covid lockdowns

  • More than 200 hospitality leaders asked the chancellor not to raise their VAT rate
  • They warned Rishi Sunak that keeping the tax rate at 12.5 percent was ‘vital’ to recovery
  • Business leaders, including the heads of Pizza Express and Caffè Nero, signed the letter










More than 200 leaders in the hospitality industry have written to Rishi Sunak urging him not to raise their VAT rate.

Ahead of Wednesday’s budget, they have warned the chancellor that they face devastation if the tax is reduced to pre-pandemic levels of 20 percent.

VAT for the sector was cut to 5 percent last summer to help pubs, bars and restaurants after the first Covid-19 lockdown.

The pre-budget letter on Wednesday urged: “A reduced VAT rate enables us to fulfill your ambitions to ‘raise’ our high streets and communities.”

It rose to 12.5 percent this month and will return to the 20 percent rate in April.

The business leaders – including the heads of Pizza Express, Caffè Nero and Travelodge – said in a joint letter that keeping the tax rate at 12.5 percent permanently is “vital” to the industry’s recovery.

Any hike would lead to higher prices for families and wipe out the sector’s ability to create jobs and boost recovery, they said.

The business leaders, including the heads of Pizza Express, Caffè Nero and Travelodge, claimed in a letter to the chancellor that raising the VAT tax would wreak havoc

The business leaders, including the heads of Pizza Express, Caffè Nero and Travelodge, claimed in a letter to the chancellor that raising the VAT tax would wreak havoc

“A reduced VAT rate allows us to help you achieve your ambitions to ‘level up’ our high streets and communities,” they added.

Trade association UKHospitality and the business leaders also urged Mr Sunak to ‘fundamentally reform’ corporate rates.

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