Reduce our VAT call from hotels

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TOURISM leaders have backed a call to reduce VAT in their sector to help bolster the economy.

Travelodge boss Guy Parsons this week asked the Government to reduce VAT across the hospitality industry to five per cent, with the backing of the British Hospitality Association, and the British Beer and Pub Association.

And the idea has won backing from the Fylde coast as a way to create more jobs, increase investment, and help struggling businesses in the harsh business environment.

The call has been made after similar schemes across Europe have seen great success in rejuvenating the tourism industry - with beneficial knock-on effects for the whole economy.

To date, 21 European countries have a lower VAT rate for hotels than the prevailing national rate, and a further 13 have lower rates for restaurants and catering establishments.

The move has been backed by Merlin, which makes clear to all of its customers exactly how much VAT there is on every purchase from their venues.

Liz Walsh, managing director at the New President Hotel on The Promenade said: “They need to do something to get this economy moving.

“Half of Blackpool looks closed at the moment and times are hard.

“It is a tough year ahead. They stick VAT up. They increase the minimum wage, and business rates have gone up. But we can’t pass all of those rises on to customers.”

VAT in Germany is seven per cent, in Belgium it is 12 per cent and in Finland 13 per cent. At 20 per cent, the UK has one of the highest European VAT rates for the sector, second only to Denmark.

France is perhaps the greatest success story, after the VAT rate for hotels was reduced to five per cent from almost 20 per cent following a campaign by the hospitality leader Jacques Borel.

Research conducted by Borel, who is President of the Union des Métiers et des Industries de l’Hôtellerie, demonstrated half of the reduction going to lower rates for consumers, while the other half goes to salaries, training, investment and profit.

Mick Grewcock of Burbage Lodge and Queens Mansions holiday apartments in Bispham also welcomed the call for a rate reduction. He said: “I would really welcome it. One-fifth of what we take goes on tax and there’s nothing to claim back. We are simply acting as tax collectors for the Government.

“It would be a fantastic move and would mean more investment in the town’s businesses.”