Europe offers hope of VAT cut on pub food

Europe has paved the way for the UK Government to slash VAT on pub food.

VAT on meals could be cut to as low as 5% after the European Commission ruled that member states could reduce VAT rates across a range of sectors.

This could be a major boost to pubs who have struggled during the current economic climate, with many pubs having been forced to close their doors due to a downturn in custom.

It is now up to the UK Government to decide whether to impose this reduction.

However, in its ruling, the European Commission suggested alternative solutions should always be considered first.

Jonathan Mail, Campaign for Real Ale's (Camra) head of public affairs, said: "A reduced VAT rate on pub meals would save jobs and save many valued community pubs from closure.

"When we met the Commission in January we stressed that a VAT reduction on meals would help stem the loss of pubs and bars across Europe. With nearly six pubs a day closing the government must consider introduction of a reduced rate of VAT for pub meals without delay.

"This is good news and shows that where a strong case is put it is possible to change EU tax rules. Over the next year Camra will be lobbying the European Union to amend its rules on excise duty to enable the UK government to reduce duty on beer sold and consumed in pubs."

Ian Loe, research and information manager at Camra, added: "We want to persuade the Commission that this should apply to alcoholic products as well. At the moment it's excluded from being granted a reduced rate of VAT, so this is the first stage."