Minister: no plans to monitor Irish VAT cut

Government ministers have "no immediate plans" to assess the impact of Ireland's recent VAT cut on the sector - and played down its expected impact on UK tourism.

Tourism minister John Penrose was pressed on the issue by MP Mike Weir in Parliament. Weir asked if Culture Secretary Jeremy Hunt has had discussions with Chancellor George Osborne about the effect on the "competitiveness of the UK tourism sector" of the Irish Government's recent decision to reduce VAT on services related to tourism to 9%.

Penrose said Hunt "speaks regularly to the Chancellor of the Exchequer..on a wide variety of topics".

He added: "VAT rates in Ireland are a matter for the Irish Government rather than one on which we should comment, but customers choose their holidays on a wide variety of factors including the overall value for money of the various places they are considering visiting, rather than focusing solely on the rate of VAT."

Penrose previously said he did not predict a VAT cut for the tourism and hospitality sector within the current Parliament.

In a separate question, Weir, Scottish National Party MP for Angus, asked if the Chancellor "will assess the likely effect on the UK economy" of emulating Ireland's VAT reduction.

David Gauke, Exchequer Secretary to the Treasury, said: "There are no immediate plans to assess the cost to the economy of a reduced rate of VAT for visitor attractions, accommodation and restaurants.

"All taxes are kept under review and any changes are announced by the Chancellor as part of the Budget process."

Last month French leisure entrepreneur and lobbyist Jacques Borel, who helped secure a VAT cut for the hospitality sector in his native country, created a VAT Club to campaign for similar action in the UK. Members include the British Beer & Pub Association, British Association of Leisure Parks, Piers & Attractions, British Hospitality Association, Tourism Alliance and VisitBritain.

The Publican's Morning Advertiser has also been campaigning for VAT for the sector to be cut to 5%.