Hospitality Industry: VAT
The question
To ask the Chancellor of the Exchequer, what estimate her Department has made of the costs to the exchequer of reducing VAT for hospitality businesses to (a) 15%, (b) 10%, (c) 5% and (d) 0%.
Answered by Dan Tomlinson
HMRC estimates that the cost of reducing the 20 per cent Standard Rate of VAT on all accommodation and food and beverage services would be as follows in 2026-27: (a) to 15%: £5 billion, (b) to 10%: £10.5 billion, (c) to 5%: £17 billion, (d) to 0%: £23.5 billion.
The Government recognises the significant contribution made by hospitality businesses to economic growth and social life in the UK.
Verbatim has judged this answer against the question that was actually asked — answered, partly answered, or evaded. Sign in to see the verdict →