Hospitality Industry: VAT
The question
To ask the Chancellor of the Exchequer, if he plans to review current VAT obligations on (a) pubs and (b) other hospitality businesses.
Answered by Treasury
The Government recognises the significant contribution made by hospitality businesses to economic growth and social life in the UK.
VAT is a broad-based tax on consumption, and the 20 per cent standard rate applies to most goods and services. VAT is the UK’s third largest tax, forecast to raise £180 billion in 2025/26.
Exceptions to the standard rate have always been limited and balanced against affordability considerations. The Chancellor makes decisions on tax policy at fiscal events in the context of the overall public finances.
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