Hospitality Sector VAT: Local Economies, Employment and Growth

Jessica Toale Excerpts

Thursday 12th November 2026 Westminster Hall

[Chris Webb]

I understand the point the hon. Member for East Grinstead and Uckfield (Mims Davies) makes, and I have heard it from caravan businesses and parks in my constituency. That has to be part of the discussions after the Second Reading of the Visitor Levy (England) Bill.

[Jessica Toale (Bournemouth West) (Lab)]

rose—

[Chris Webb]

I give way to my hon. Friend.

--- Later in debate ---

[Alex McIntyre (Gloucester) (Lab)]

It is a pleasure to serve under your chairship, Dr Huq. If not for hospitality, I would not be here today—quite literally, because my parents met while working second jobs in a pub in north London. Later, they ran a small bed and breakfast, where I was cleaning rooms and serving breakfasts from an age I probably should not advertise here. I cooked my first full English for paying guests at 13 years old, and at the same age started working in the local pub as a pot wash. At 15, I moved to front of house at another hotel, where I worked for more than seven years. Hospitality gave me many of the skills that led me to this place, and I care deeply about the sector.

Times are tough. Small businesses across Gloucester tell me time and again about rising energy bills and soaring food prices, driven up both by the wars in Ukraine and the middle east, and by the tax burden they face. But in the middle of this difficult patch, Gloucester’s hospitality sector continues to deliver for local residents. Dr Foster in our docks was named best town pub at this year’s Great British pub awards, a real testament to the team there. We have fantastic independent coffee shops such as Coffee House 43, Forum Coffee and the Roastery, and brilliant restaurants such as Topoly’s Italian on Southgate Street. Just last Sunday, I was in The Fountain Inn for a fantastic roast dinner in between Remembrance Day services.

Many of those businesses have asked for a cut in VAT; I understand those calls, but I also recognise that in the current economic climate, that is a challenging decision for any Government to deliver. Any tax cut, proposed by any party, needs to be paid for, but that does not mean that we should not be supporting our hospitality industry, and in particular targeting support for local, independent small and medium-sized enterprises. I welcome the Government’s recent announcements on business rates: a 20% cut for pubs, clubs and music venues from April and taking around 70,000 smaller hospitality and retail businesses out of business rates altogether.

[Jessica Toale]

Does my hon. Friend agree that, if the Government cannot go the full way on the VAT cut that some in the hospitality sector are proposing, they should consider Hospitality Voice’s proposal, which is backed by research from Bournemouth University, for an emergency, time-bound cut from 20% to 13%? That would be an affordable alternative way to protect jobs and boost local economic activity.

[Alex McIntyre]

My hon. Friend makes an eloquent point raising important research from her constituency, and I am sure that the Minister has heard her intervention. I welcome the fact that the Government have made a start on business rates. I have continuously raised that issue with Ministers on behalf of Gloucester business owners, and it is good to see action.

I know that the Minister shares my commitment to our hospitality industry, so it would be helpful if he set out how the Government intend to go further to support hospitality businesses in Gloucester. For future generations, I know how important a first job in hospitality can be. We have 2,500 young people not in employment, education or training in Gloucester; that is why I am hosting the Gloucestershire futures summit later this month at Kingsholm rugby stadium. Can the Minister set out how the Government will make it easier for hospitality businesses to hire young people and offer the part-time weekend jobs that are the springboard for many young people in my city? Our pubs, cafés and restaurants are where Gloucester comes together. I owe my family to the jobs that they create. Let us make sure that they are still there for the next generation.