Public Houses: VAT
The question
To ask the Chancellor of the Exchequer, if her Department will make an assessment of the potential merits of reducing VAT for community pubs.
Answered by James Murray
The Government recognises the significant economic contribution made by pubs as well as their importance in fostering a sense of place and community across the UK.
VAT is the UK’s second largest tax, forecast to raise £176 billion in 2024/25. Taxation is a vital source of revenue which helps to fund public services.
The Government has inherited a challenging fiscal position, with debt near 100% of GDP and borrowing more than double what it was before the pandemic. In addition to this, a Treasury audit in July 2024 revealed an additional £21.9 billion pressure on departmental spending.
As a result, the Government will have to take difficult decisions in relation to tax, spending and welfare at the budget.
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