HOSPITALITY FIRMS URGE ANDY BURNHAM TO CUT VAT FOR SECTOR

More than 800 hospitality businesses have signed an open letter urging Prime Minister Andy Burnham to set out plans to cut VAT for the sector, the #VATsTheProblem campaign said. The letter warns that without a "fairer tax burden for hospitality", the industry will see more closures, job losses and fewer opportunities for young people. Signatories include pub groups Fuller's, Greene King and Wetherspoons, restaurant chains Pizza Express and Wagamama, and hotel operators including Marriott International and Centre Parcs. Celebrity chefs backing the campaign include Tom Kerridge, Angela Hartnett and Heston Blumenthal. Organisers said most signatories are small and medium-sized businesses, including independent pubs and hotels.

The letter is tied to a petition that has gathered more than 370,000 signatures calling for hospitality VAT to be cut to 10 per cent, in line with the European average, campaigners said. Kerridge said 20 per cent VAT is "holding hospitality back" because businesses can reclaim VAT on products but not on staff. Campaigners said a lower rate could turn "closures into openings, lost jobs into new jobs, and boarded up high streets into thriving centres of community." The letter follows a pledge Burnham made in February, when he was mayor of Greater Manchester, to argue for a hospitality VAT rate in line with Europe because of the sector's value to towns.

The campaign follows Burnham's 20 per cent cut to business rates for pubs, clubs and live music venues in his first week in office. That move was part of a £100 million support package for the sector. Organisers said Burnham faced calls to go further after that announcement. No date has yet been given for a government response to the letter.