Hundreds of hospitality businesses call on Burnham to lower VAT
More than 800 hospitality operators, including restaurants, pubs and resorts, have signed a letter to Prime Minister Andy Burnham urging a reduction of VAT on the sector from 20% to 10%. The campaign, backed by chefs and trade bodies, argues the current rate hampers employment and high‑street regen…
In a coordinated effort that saw over eight hundred hospitality businesses sign a letter, the sector is demanding a significant change to the value‑added tax (VAT) it pays. The campaign, titled VAT’s The Problem, calls for the UK’s hospitality VAT rate to fall from the standard 20% to a more modest 10%, a level that aligns with the European average.
Who is pushing for the change?
The petition is signed by a mix of small‑to‑medium‑sized venues and larger chains. Notable signatories include celebrity chefs Heston Blumenthal and Tom Kerridge, as well as restaurant brands such as Bill’s, Franco Manca, Pizza Express and Wagamama. Pubs and breweries such as Fuller’s, Greene King, Robinsons Brewery and Wetherspoon’s are also on board, alongside resort operators like Center Parcs, Haven and Marriott International. Trade bodies including UKHospitality, the British Beer and Pub Association, the British Institute of Innkeeping and Code Hospitality have publicly endorsed the campaign.
Why the current rate is a problem
Hospitality operators argue that the 20% VAT is disproportionately burdensome because most of their costs are labour‑heavy. Unlike many other businesses that can reclaim VAT on goods, hospitality firms cannot recover VAT paid on staff wages. This means the tax is effectively a direct cost on the workforce, increasing operating expenses at a time when wages, energy bills, food prices and business rates are already on the rise.
Tom Kerridge, who has signed the letter, highlighted that the sector is “different from many other businesses because so much of what we spend our money on is our teams.” He added that the high tax rate is “holding hospitality back” and that without intervention, more venues will close, jobs will be lost and opportunities for young people will diminish.
Political context and upcoming meetings
Prime Minister Andy Burnham, who took office in July, has publicly pledged support for a lower hospitality VAT rate during a February announcement. He is scheduled to host a series of events at 10 Downing Street aimed at positioning his government as a “partner for growth.” On Monday, he will meet with business leaders to discuss backing entrepreneurs and reforming business rates for high‑street venues.
The letter arrives at a time when Burnham is keen to demonstrate tangible action on his promises. The hospitality sector’s appeal to the government is amplified by the sector’s role in community life and the high‑street economy, which has been a focus of Burnham’s agenda since his appointment.
Public support and the #VATsTheProblem petition
Beyond the letter, a petition titled #VATsTheProblem has attracted more than 370,000 signatures. Signatories call for the 10% rate to help “turn closures into openings, lost jobs into new jobs, and boarded‑up high streets into thriving centres of community.” The petition underscores the widespread frustration among hospitality owners, many of whom operate venues that are central to their local communities.
What’s next for the campaign?
While the letter and petition have put pressure on the Prime Minister, no concrete timetable has been announced for a VAT change. The campaign’s leaders are urging Burnham to bring forward plans to deliver the lower rate, noting that “we don’t need another promise. We need action.”
Should the government decide to move forward, it would represent a significant policy shift, potentially easing financial strain on thousands of hospitality businesses and contributing to the regeneration of high streets across the country.
Until then, the hospitality sector remains in a state of anticipation, hoping that the Prime Minister’s upcoming meetings with business leaders will translate into policy action.
Key takeaways
- 800+ hospitality businesses have signed a letter demanding a VAT drop to 10%.
- Major chefs and restaurant chains support the campaign.
- High VAT is seen as a major barrier to employment and high‑street regeneration.
- Prime Minister Andy Burnham has pledged support but no timetable exists.
- Over 370,000 people have signed a petition backing the VAT reduction.
Frequently Asked Questions
- What is the current VAT rate for hospitality? The standard rate is 20%.
- Why is a 10% rate being requested? It aligns with the European average and would reduce labour costs for hospitality operators.
- Will the change affect all hospitality businesses equally? The proposed rate would apply across the sector, but implementation details are yet to be announced.
Why it matters
A lower VAT rate could revive struggling pubs, restaurants and high‑street venues, preserving jobs and strengthening local communities.
Key points
- 800+ hospitality firms urging VAT cut
- Chefs Heston Blumenthal and Tom Kerridge endorse
- 20% VAT hampers labour‑heavy sector
- Prime Minister Burnham pledged support
- 370,000 petition signatures
- No timetable yet for policy change
Frequently asked questions
What is the current VAT rate for hospitality?
The standard rate is 20%.
Why is a 10% rate being requested?
It aligns with the European average and would reduce labour costs for hospitality operators.
Will the change affect all hospitality businesses equally?
The proposed rate would apply across the sector, but implementation details are yet to be announced.
