Membership of the VAT Club – which is campaigning for a cut in VAT to 5% for hospitality businesses – has increased from 43 to 58 companies in the past three months and Borel claims to be on target for 75 members by Easter.
Borel said the VAT Club had been harmed by the negative publicity in November surrounding its VAT fine, but he added that a dozen campaign members rallied round with active support and no one withdrew their membership.
“In the long term it will be beneficial, as we will emerge from the crisis much stronger,” he said.
Borel singled out Tim Martin for special praise. “Without Tim there would be no campaign,” he said, adding that the Wetherspoon’s chairman has personally recruited a number of his company’s suppliers to the campaign.
This additional funding has allowed the VAT Club to rent a London office and plan for the recruitment of a campaign deputy to accelerate lobbying efforts.
Borel said that VAT Club activity in 2014 would be 60% lobbying and 40% fundraising (compared to a ratio of 20:80 in 2013). “Before Tax Parity Day [when 15,000 pubs and restaurants cut their prices by 7.5% to simulate a lower rate of VAT], MPs weren’t ready to listen,” he said. “Now the door is open.”
Initial meetings with MPs of all political parties have been positive, he added, claiming that all are sympathetic to the campaign’s arguments that youth unemployment must be addressed, and most accept that the current VAT regime is unfair on pubs and restaurants.
He also revealed that he has reopened discussions with the Treasury to gain agreement about the potential costs to the Exchequer of a VAT cut, after the government department said it disagreed with the VAT Club’s initial estimates.
“My guess is that we will settle on a figure of £9.3bn,” he said. “At least that will then give us a common base on which to negotiate.”
Borel refused to predict the outcome of his lobbying efforts, but hoped a VAT cut for hospitality might yet feature in the 2014 Autumn Statement or become a 2015 general election manifesto commitment from one of the major political parties.
“Will the green light come from the Conservatives, Labour or Liberal Democrats? I don’t know, but I must inform all three parties and not favour one over the other,” he said.