On 23 March, the Chancellor Rishi Sunak announced his spring statement with many claiming that he has missed an opportunity to help businesses and the hospitality industry with the current cost of living crisis.
Despite a commitment to cut fuel duty by 5p a litre, the much campaigned for VAT reduction for hospitality businesses never came to fruition meaning they are now reverted back to the full VAT rate for businesses after the temporary introduction of the cut to help them bounce back after Covid restrictions.
UK Hospitality Chief Executive Kate Nicholls stated
“For many businesses, the removal of the lifeline of a lower rate of VAT might prove fatal. For a heavily, disproportionately taxed sector a return to 20% dashes the hopes that many businesses could begin to recoup some of the losses of the last two years.”