Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of extending the VAT reduction offered to hospitality services until March 2021 to (a) hairdressers, (b) beauty services and (c) other close contact services.

The temporary reduced rate of VAT was introduced on 15 July in order to support the cash flow and viability of over 150,000 businesses and protect 2.4 million jobs in the hospitality and tourism sectors, and will run until 31 March 2021. This relief comes at a significant cost to the Exchequer, and there are currently no plans to extend the scope to include other sectors.

The Government has announced a significant package of support to help businesses through the winter months, which includes an extension of the Coronavirus Job Retention Scheme, an extension of the Self-Employment Income Support Scheme grant, and an extension of the application window for the Government-backed loan schemes.