VAT cuts and rates holiday vital to sector survival
Trade bodies have called for further government support for the hospitality industry, following recent news that nearly three-quarters of sector businesses could close in 2021.
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 published by UKHospitality, the British Beer and Pub Association and the British Institute of Innkeeping,
The removal of curfew restrictions and allowing household mixing in venues are also vital to survival.
In the survey of more than 400 different businesses who 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.
One in four felt that enhanced grants to enable them to meet at least some of their costs while closed, was vital to their survival.
The trade associations say the government must now deliver this urgent support the sector requires to help ensure its very survival.
In a joint statement, the trade bodies said: “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.
“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.
“Beyond these, there is still much the government can, and should, do to give beleaguered businesses a fighting chance of survival. This includes getting as much of the sector open as possible at the start of December.
“Rethinking the arbitrary 10pm curfew, which hamstrings venues, is a must. We also need to review the ban on household mixing inside venues in Tier 2 regions, which is keeping friends and families apart.
“The restrictions being imposed on businesses before we went into the second lockdown were strangling trade and putting people out of business. If we exit this lockdown into similar, or worse, tighter, restrictions, it is going to be the end for thousands of businesses.”