345 hospitality businesses urge tax cuts ahead of Budget

More than 340 leading hospitality businesses have signed an open letter to the chancellor calling for urgent action in the upcoming Budget to support the sector.

The letter, coordinated by trade body UKHospitality, is backed by companies including Butlin’s, Greene King, IHG Hotels and Resorts, KFC, Merlin Entertainments, Marston’s, Wagamama, Fuller’s and Loungers. 

It urges government intervention to reduce the tax burden on hospitality, warning that the last Budget had a “socially regressive” impact on the industry.

According to the letter, the previous Budget left many firms “taxed out”, leading to closures, job losses and rising costs for consumers. 

UKHospitality estimates more than 80,000 jobs have been lost across the sector since then.

The signatories are calling on the chancellor to:

• Reduce business rates by providing the maximum discount for hospitality properties under £500,000 rateable value and removing penalties for larger sites.
• Reform National Insurance contributions (NICs) to encourage the recruitment of young people and those returning to work.
• Cut VAT on hospitality to promote investment and align the UK more closely with European competitors.

The letter said: “Many businesses have either closed or cancelled planned expansion. Young people and those who work part time have seen their opportunities narrow and the benefit bill has grown as a result. Towns and rural and coastal areas have been hit harder than the big cities due to the prevalence of hospitality. Consumer prices have risen. 

“We are asking for urgent action at the Budget, so we can support your goals to get young people and the economically inactive into work, regenerate high streets and boost tourism and, ultimately, drive economic growth.” 

Kate Nicholls, chief executive of UKHospitality, added:  “This extraordinary coalition demonstrates the united view of hospitality that there needs to be urgent action at the Budget.

“The impact of the last Budget was devastating. Business closures, job losses, curtailed investment, consumer price rises and lost opportunities for young people are all direct impacts of the choice made to inflict £3.4bn of additional annual cost on our sector. Without action, we will see these impacts continue and intensify. “In two weeks’ time, these businesses and the millions of people they employ need to see measures to reduce hospitality’s cost burden and back our sector.”

She concluded: “Hospitality is clear: lower business rates, fix NICs and cut VAT to support hospitality, affect change on our high streets and support the renewal of the country. The open letter is signed by senior leaders from 345 businesses spanning pubs, restaurants, hotels, bars, visitor attractions and leisure parks, representing the breadth of the UK’s hospitality industry.”