UK encouraged to follow Ireland’s VAT cut to boost hospitality

The British Hospitality Association (BHA) has launched a campaign to encourage the UK government to follow Irish legislation and cut VAT, in order to boost the hospitality and tourism market.

The BHA has suggested that 1.77 million visitors travelled to Ireland between March and May 2013, a rise of nearly six per cent compared to the same period in 2012. These figures come after the Irish government changed the VAT rate for holidays from 13.5 per cent to just nine per cent. Not only has this boosted the tourism trade in the region, but it has helped to create 10,000 new vacancies, primarily hospitality jobs, within the industry.

Currently the UK has a 20 per cent VAT rate, one of the highest in Europe, meaning that families are faced with very high prices when they holiday in the UK. This has led to a major slump in the tourist trade, causing the BHA to launch the 'Cut Tourism VAT' campaign.

Cut Tourism VAT campaign chairman Graham Wason said: “These latest figures clearly show the positive impact that a reduced rate of tourism VAT can have on the economy. Whilst the UK tourism sector struggles under a 20 per cent rate, the Republic of Ireland has taken advantage of a lower rate to increase its visitor numbers and new jobs. Hard-working British families have to look to get the most value from every holiday pound they spend, and the UK’s high tourism VAT encourages them to take a break abroad in Ireland, France or elsewhere in Europe.”

The UK government is yet to formally announce any response to this industry-backed scheme. The project is also being led by Bourne Leisure Group, Merlin Entertainments Group, and the British Association of Leisure Parks, Piers and Attractions.

Berkeley Scott is a specialist recruitment agency providing hospitality employment solutions.