TCG pledges support for VAT Tax Equality Day

By Ellie Bothwell contact

- Last updated on GMT

Related tags: Tax equality, Value added tax, Jacques borel vat club

Tax Equality Day is being staged by the Jacques Borel VAT Club
Tax Equality Day is being staged by the Jacques Borel VAT Club
Managed pub and bar operator TCG has pledged to support Tax Equality Day on 24 September.

All 69 of the company’s sites will take part, by cutting the price of food and drink by 7.5% on the day.

The proposed Tax Equality Day, staged by the Jacques Borel VAT Club, aims to reduce the level of VAT in the hospitality sector from 20% to 5%.

TCG supported the first Tax Equality Day last September and is getting behind this year’s event with posters, leaflets and staff in all its pubs and bars explaining the campaign to customers.

The aim is to raise awareness of the high rate of VAT paid on food and drink in pubs, compared to that paid by supermarkets.

'VAT hits the hospitality industry hard'

TCG chief operating officer Nigel Wright said: “The current 20% VAT rate continues to hit the hospitality industry hard. By taking part in Tax Equality Day, we’re able to take the key messages about the VAT campaign to customers across our diverse estate, from our world famous Tattershall Castle floating pub on the Thames, to city centre bars and local pubs.”

He added: “Our industry is a large employer, particularly of young people, and a major contributor to the Treasury. We think it’s fair to ask the Government to show support for pubs and bars, especially since projections show the cut in VAT revenue would be balanced by increased taxes generated by higher levels of trade and more jobs in the sector.”

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Some light reading

Posted by Interested Observer,

put the case from JB and Cut Tourism VAT.

The issue from HMG's point of view might be that the loss of revenue is immediate, but the projected gain is years in the future; this would presumably apply to any industry.

I also think the language in the PMA, although it may be straight from a press release, muddies the waters.

So far as I am aware the supermarkets and pubs PAY (and reclaim) VAT at exactly the same rate. The difference is in the rate that the retail customer pays. There's no difference on drinks nor on some foods, and if a pub were to sell raw meat etc there would be no difference there either.

In any event if everything from Tesco were 20% more expensive, or the pub 20% cheaper I'm not sure that we would see a stampede to the pubs to dine out rather than dine in.

I'm not sure where the pubcos come into this.

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Where are the substantive arguments?

Posted by Anti-pub self regulation,

I wish that someone would investigate the debate a little bit more thoroughly (hint for the PMA). There are three factors, amongst many others, that the VAT Club seem to ignore: -

1. Can someone at the VAT Club tell me where this cut in VAT will be funded from? We have a NHS funding crisis and as a country will not be able to afford paying pensions in the medium to longer-term.
2. One of the biggest employers in this country is the automotive industry. Aren't they more deserving of a VAT cut? What about other growth industries? So why isn't the VAT Club looking at the VAT rate overall and lobbying for an overall decrease or at least putting forward an argument as to why the hospitality industry is the only industry impacted by a VAT rate of 20%.
3. The pubcos "add value" by being a middle party to a transaction but not doing very much. Why not address that?

I am still to be convinced the the zero rating of supermarket food is the cause of all evil in the hospitality sector.

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