Chef and pub owner Tom Kerridge has launched a campaign urging the Government to cut VAT on hospitality businesses from 20% to 10%, warning that without action, thousands of venues could close.
Hospitality 'at breaking point'
Kerridge, who owns five pubs and restaurants including The Hand & Flowers in Marlow, said the industry is under siege and being used as a scapegoat for wider economic issues. He noted that hospitality is the third-largest employer in the UK, behind the NHS and retail, employing 3.6 million people and contributing £96 billion annually to the economy, according to UKHospitality figures.
“I live and breathe hospitality every day. It’s difficult across the board, at all of them. I have five businesses and not all of them are profitable,” Kerridge wrote in an article for the Evening Standard.
VAT cut campaign
The campaign, called VAT’s the Problem, aims to collect one million signatures in support of reducing VAT to 10%. Kerridge argued that a 20% rate is unfair given other costs such as business rates, utility bills, and rents. He pointed to lower rates in European countries: 10% in Italy, France, and Spain, and 7% in Germany.
“I think 10 per cent is fair for hospitality; 20 per cent is not,” he said.
Support from new PM
Kerridge welcomed Prime Minister Andy Burnham’s recent announcement of business rates cuts for pubs and clubs, calling it a positive step, but stressed that VAT remains the bigger issue. He expressed hope that Burnham, who has backed a VAT cut, could bridge divides between the industry and government.
“I think he understands the importance of pubs, restaurants and nightlife,” Kerridge said.
Industry backing
Kerridge is joined in the campaign by fellow chefs Thomasina Miers, Tommy Banks, and Yotam Ottolenghi. He warned that hospitality venues are closing at a rate of around 21 per week due to taxes, business rate hikes, employer National Insurance increases, and rising energy and food costs.
“Imagine a neighbourhood without a local pub, somewhere to meet friends, a community asset?” he asked. “Let’s cut VAT to 10 per cent. Let us go out and get to work.”
