A Bill to make provision to modify the effect on domestic law of arrangements relating to the withdrawal of the United Kingdom from the European Union; and for connected purposes.
Asked by: Lord Dodds of Duncairn (Democratic Unionist Party - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the provisions of the Windsor Framework relating to VAT on the ability to reduce the rate of VAT for the hospitality sector in Northern Ireland.
Answered by Lord Livermore
The UK’s standard VAT rate of 20 per cent is close to the OECD average of 19.3 per cent and is forecast to raise almost £190 billion in 2026/27.VAT is a broad-based tax on consumption, and the standard rate applies to most goods and services. VAT on services, including hospitality, does not fall within the scope of the Windsor Framework.
There are no current plans to introduce regionally differentiated VAT rates for hospitality, which would add complexity to the tax system.
The Government has announced the Great British Summer Savings scheme. This provides a temporary reduction in VAT from 20 per cent to 5 per cent from 25 June to 1 September 2026 on eligible children’s meals, family leisure tickets and admission to summer attractions across England, Wales, Scotland and Northern Ireland, providing targeted support for families and for hospitality and tourism businesses across the UK.
Asked by: Lord Dodds of Duncairn (Democratic Unionist Party - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what discussions have been held with the Northern Ireland Executive about differential VAT rates for areas of the UK which are in direct competition with hospitality businesses in another jurisdiction.
Answered by Lord Livermore
The UK’s standard VAT rate of 20 per cent is close to the OECD average of 19.3 per cent and is forecast to raise almost £190 billion in 2026/27.VAT is a broad-based tax on consumption, and the standard rate applies to most goods and services. VAT on services, including hospitality, does not fall within the scope of the Windsor Framework.
There are no current plans to introduce regionally differentiated VAT rates for hospitality, which would add complexity to the tax system.
The Government has announced the Great British Summer Savings scheme. This provides a temporary reduction in VAT from 20 per cent to 5 per cent from 25 June to 1 September 2026 on eligible children’s meals, family leisure tickets and admission to summer attractions across England, Wales, Scotland and Northern Ireland, providing targeted support for families and for hospitality and tourism businesses across the UK.
Asked by: Lord Dodds of Duncairn (Democratic Unionist Party - Life peer)
Question to the HM Treasury:
To ask His Majesty's Government what recent assessment has been made of the impact of the 20 per cent VAT rate on the competitiveness of the UK tourism and hospitality sectors.
Answered by Lord Livermore
The UK’s standard VAT rate of 20 per cent is close to the OECD average of 19.3 per cent and is forecast to raise almost £190 billion in 2026/27.VAT is a broad-based tax on consumption, and the standard rate applies to most goods and services. VAT on services, including hospitality, does not fall within the scope of the Windsor Framework.
There are no current plans to introduce regionally differentiated VAT rates for hospitality, which would add complexity to the tax system.
The Government has announced the Great British Summer Savings scheme. This provides a temporary reduction in VAT from 20 per cent to 5 per cent from 25 June to 1 September 2026 on eligible children’s meals, family leisure tickets and admission to summer attractions across England, Wales, Scotland and Northern Ireland, providing targeted support for families and for hospitality and tourism businesses across the UK.