Hospitality Sector VAT: Local Economies, Employment and Growth Debate
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Ben Maguire
Main Page: Ben Maguire (Liberal Democrat - North Cornwall)Department Debates - View all Ben Maguire's debates with the HM Treasury
Hospitality Sector VAT: Local Economies, Employment and Growth
Ben Maguire Excerpts(1 day, 21 hours ago)
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Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)
It is a pleasure to serve under your chairship, Dr Huq. I commend the hon. Member for Blackpool South (Chris Webb) for securing the debate and the hon. Member for Gower (Tonia Antoniazzi) for moving it.
First, I reiterate the SNP’s steadfast, long-standing support for an immediate reduction of hospitality VAT to 10%. From the highlands to the borders, hospitality is the beating heart of our communities, yet our pubs, cafés, restaurants and hotels are being crushed under the perfect storm of soaring energy costs, food inflation and the UK Government’s hike to employer national insurance contributions.
Ben Maguire (North Cornwall) (LD)
A very well-known hotelier in my constituency said that if he had known about that national insurance rise, he would not have opened a particular hotel and potentially not given all its job opportunities to young people. Does the hon. Member agree that a targeted national insurance cut for young employees would be a good way to boost the hospitality sector?
Graham Leadbitter
Yes, absolutely. That was well debated this week, and we supported it. The sector pays an unsustainable 82p in business taxes for every £1 of profit. The Prime Minister has previously recognised the situation and has stated his support for cutting VAT for the hospitality industry. Now that he sits in Downing Street he must finally match his past rhetoric with action.
That call does not come from the SNP alone; it is backed by an overwhelming coalition. Over 400,000 people, including 100 leading chefs, have backed the “VAT’s the Problem” campaign, alongside UKHospitality and the British Beer and Pub Association. The public demand is deafening—and nowhere is that clearer than in my community. Of all constituencies in the country, Moray West, Nairn and Strathspey recorded the highest number of signatures—616—to the recent parliamentary petition calling for a 10% VAT rate on hospitality.
We have already felt heartbreaking losses. Many venues are struggling to recover after devastating summer wildfires that kept visitors away from affected areas. Champions of our local hospitality economy are backing that campaign to stay afloat, including—among many others—Scribbles restaurant in Elgin, Harbour Lights café and restaurant in Lossiemouth, the Aberlour hotel, the Apiary café in Dalwhinnie, Antlers café in Newtonmore and, needless to say, the Cairngorm mountain, which has the highest venue in the UK at 3,500 feet above sea level.
The Treasury continually hides behind its static, short-sighted cost figures, but a VAT cut is not lost revenue. It will be substantially offset as businesses reinvest their cash flow directly into physical assets and additional staff. The Treasury should listen to the hundreds of thousands across the country backing the campaign, listen to businesses and residents, and deliver the 10% VAT cut that will release the potential of our hospitality sector.