Chancellor Rachel Reeves has announced a temporary cut in VAT from 20% to 5% on summer attractions including theme parks, zoos, museums, and soft-play centres. The measure, part of a £300m scheme called 'Great British summer savings', will run from 25 June to 1 September and also apply to children's theatre and cinema tickets and kids' meals in restaurants.
The Treasury estimates that if companies pass on the savings, a child's cinema ticket could drop by £1.50 and a family day out at a wildlife park could be £17 cheaper. The scheme also includes free bus rides for under-16s in England during August. Reeves confirmed a postponement of fuel duty increases due in September and December, and said import tariffs on some foods including chocolate and biscuits would be suspended, expecting supermarkets to pass on savings to customers.
To help fund the package, Reeves announced changes to the 'foreign branch profits' regime targeting oil and gas companies that use complex structures to reduce UK tax. She stated: 'We must ensure that those who benefit from increased prices and volatility pay their fair share.' The new tax measures are expected to raise 'hundreds of millions of pounds a year' from 1 September.
Reeves also raised the tax-free mileage rate for workers claiming driving costs by 10p, benefiting those who drive for work. Additionally, £350m has been allocated for a 'critical chemicals resilience fund' to support industries hit by high energy costs. The chancellor declined to specify winter support but emphasised that any future scheme would be 'targeted and temporary'.
