Michelin-starred chef Tom Kerridge has launched a petition calling for a reduction in the UK's hospitality VAT rate from 20% to 10%, citing the current rate as a key factor behind widespread closures of pubs, bars, and restaurants. The petition, named 'VAT’s The Problem', has already garnered over 230,000 signatures since its unveiling last month.
Industry at Breaking Point
“Our pubs, restaurants, cafes, hotels, nightclubs and many more, are at the heart of our communities,” Kerridge said. “They bring people together and bring life to our cities, towns and villages, but they're under huge pressure from rising costs.” The UK's 20% hospitality VAT is the second highest in Europe, and industry owners say they are at a breaking point.
Luke Payne, owner of the Pack Horse pub in Hayfield and the Almanac in Glossop, told the Manchester Evening News: “A reduction on hospitality VAT is something that the industry has been urging for such a long time. We’re so far out of line with our European neighbours. There’s only so much that we can take, we’re being pushed to the very limit.” Payne added that he has not been able to take a salary from either business for six years due to financial pressure.
Mounting Cost Pressures
Charlotte Heyes, co-founder of Manchester pizza brand Nell's, highlighted the cumulative impact of National Insurance increases, statutory sick pay changes, higher utility bills, rent, wages, and ingredient costs. “The pressures are just mounting up and they have been since Covid really,” she explained. “Consumer’s tolerances are kind of at the limit now - eating out is more of a luxury than it's ever been. People used to do it once a week, but they can't go out anywhere near as much as that anymore.”
Andy Burnham's Potential Role
Many in the sector hope that Greater Manchester Mayor Andy Burnham, a potential future Prime Minister, will support the campaign. Kerridge said he believes Burnham would “one hundred per cent” back the petition. Burnham has previously called for a 10% VAT cut for hospitality and pledged to cut business rates for pubs and music venues by 20% if he becomes PM, which he claims would inject an extra £100 million into the sector. He also proposed abolishing business rates for single-site shops, cafes, and restaurants, and increasing the threshold for small business rate relief from £15,000 to £21,000, funded by taxing online tech giants.
Payne expressed cautious optimism: “I would hope that Andy Burnham is in a position where he will listen to us. He has certainly made some good noise towards the hospitality industry and I think that, as Greater Manchester Mayor, he has played a massive part in helping the sector boom. ... I think his heart is in the right place, he’s an excellent communicator and I think he will stand up for what he believes in much better than anyone in the government currently does. I can only hope that the message gets through to him quickly and clearly. It’s only a matter of time before we lose a limitless amount of good places that are run by hardworking and honest people.”
Industry Calls for Action
Kate Nicholls, Chair of UKHospitality, emphasized the sector's importance: “Hospitality plays a vital role in every community across the UK. It supports local people, driving economic growth and creating jobs and opportunities, particularly for those millions of young people currently not in employment, education or training. However, many hospitality businesses continue to face immense cost pressures and operational challenges, all of which is resulting in a slowdown in investment, recruitment and, sadly for some, even permanent closures.” She called for a 10% hospitality VAT rate, business rates reform, and support for skills development.
Heyes concluded: “Lowering the VAT would make such a difference to so many. It would not only help support venues like ours and give us a chance to survive, but it would help ensure people have places to go out and socialise. If we carry on like we are, it’s just going to be one extra closure after another.” The petition officially launches on July 1, potentially coinciding with a change in government leadership.
