Conservative MP urges chancellor to ‘do the maths’ and halve VAT

A Conservative MP has called on the chancellor to “do the maths” and reduce VAT on hospitality businesses to 10% after the Spring Budget failed to address the issue.

Tobias Ellwood, MP for Bournemouth East, intervened in the House of Commons following the chancellor’s announcement earlier this week.

Ellwood said: “What I did not see in the red book were any plans to reduce VAT for the hospitality industry from 20% to 10%. As hospitality recovers [from the pandemic] today it’s hit by the perfect storm of inflation, driving up wages, higher food prices and of course increased utility costs.”

“There is a petition on the UK government website that has now reached over 11,000 signatures and I hope the Treasury will do the maths, will lower VAT and allow hospitality operations to survive and indeed build and grow, thus increasing productivity and that will help advance GDP. Please, chancellor, I invite you to do the maths.”

Ellwood later tweeted: “A budget for growth: much to welcome in this budget that will see inflation drop from 10.1% today to 2.9% by the end of the year. (OBR figs). But I raise one proposal that would really help Bournemouth: Reduce VAT on hospitality from 20% to 10%!”

The petition has since received over 12,000 signatures, which means that the government will be required to respond.

It was created by Andy Lennox, founder of Zim Braai restaurants and managing director of the Fired Up Collective.

Lennox responded to Ellwood’s tweet with: “At least we have 1 MP with integrity who actually listens.”

Sacha Lord, night time economy adviser for Greater Manchester, added: “This single intervention would help the whole sector across the UK.”

The petition has until 7 May 2023 to reach 100,000 signatures, at which point it will be considered for debate in parliament.

Hospitality businesses had also urged the Treasury to halve VAT prior to the Autumn Statement, which was made last November.

More information about industry reaction to the Spring Budget can be found here.