Pubs and restaurants in Devon and Cornwall cut the price of food in VAT protest
Pubs across the Westcountry will be cutting the price of all food and drink by 7.5% today as part of a campaign to highlight the benefit of a VAT reduction in the hospitality industry.
At present all food and drink in pubs is subject to 20% VAT, compared to supermarkets which benefit from 0% VAT rate.
The hospitality sector is using Tax Parity Day to call on the Government to reduce the rate to 5%, and pubs from across Devon and Cornwall are taking part in the scheme.
St Austell Brewery will reduce prices at its 25 managed pubs, and will be joined by 19 of its tenanted businesses. Managing director James Staughton said: "Creating a tax parity between pubs and restaurants and supermarkets will not only benefit consumers, who will get lower prices, but the resulting increase in customers will mean more jobs are created in the sector. This could be up to an estimated 670,000 based on the experience of other European countries.
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"St Austell Brewery is fully committed to supporting this campaign, which will give our economy a much needed boost and bring more business to the region's pubs, as well as benefiting the public."
Many of the JD Wetherspoons pubs in the Westcountry are also taking part.
Nick Hill, who manages the Packet Station in Falmouth, said: "We are keen to highlight the amount customers would save if VAT in pubs was lowered.
"So, for example, the total price of a meal and drinks for a customer at The Packet Station would be reduced from £10 to £9.25 on Tax Parity Day."
Malcolm Bell, head of tourism for VisitCornwall said price is becoming the dominant factor for many in choosing their destination for a break or the main holiday.
He said: "We must be as competitive and compete on a on a level playing field – this initiative will clearly demonstrate what a difference it would make if taxation in the UK was at a par with many of our rivals."
French entrepreneur Jacques Borel has campaigned successfully for VAT cuts to the hospitality sector in a number of European countries including France, Germany, Ireland and Sweden.
He said: "Our aim is to secure a more equal tax treatment for food sold through pubs, restaurants and food service operators compared to supermarkets, which benefit from a zero VAT rate.
"Our supporters are reducing their prices by 7.5% for one day, as this is the amount we believe prices would fall by if VAT were cut to five per cent, as we estimate 60% of any reduction would be passed on to the customer."