Treasury has no plans to extend VAT cut but Sunak insists more support is coming The Treasury says it has no plans to extend the VAT cut for the hospitality sector, despite the Chancellor warning that the economy will get worse before it gets better.
Speaking during Treasury Questions in the Commons yesterday (26 January), Rishi Sunak told Tory MPs that the cost of the new Coronavirus bailouts they are demanding could reach £30bn, and urged patience among backbenchers, stating that additional measures would be unveiled in the Budget on 3 March.
While details of what the next financial package may include remain thin on the ground, it would appear that presently the Treasury has no intentions to further extend the cut to 5% in VAT for hospitality, tourism and leisure, despite multiple calls from industry bodies including UKHospitality and the British Beer & Pub Association (BBPA) for the Chancellor to do so.
No plans to extend VAT cut for hospitality, Treasury minister says
The VAT rate was reduced from 20 per cent to five per cent for hospitality firms last year
The government has “no plans” to extend the VAT cut for hospitality, tourism and leisure firms, despite industry calls for the tax break to continue while the sector is under coronavirus restrictions.
Rishi Sunak last year reduced VAT for hospitality firms from 20 per cent to five per cent as part of emergency coronavirus measures.
The tax cut is due to end on 31 March, although industry lobbying groups have urged the Chancellor to extend it further while coronavirus restrictions remain in place.
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