UKH demands new tax rate for sector

By Gary Lloyd contact

- Last updated on GMT

Range of demands: Kate Nicholls of UKHospitality
Range of demands: Kate Nicholls of UKHospitality

Related tags: Finance, Legislation, Pubco + head office, Property

A new hospitality tax rate must be introduced to aid the recovery of the sector while a sales tax must be introduced for online businesses, according to UKHospitality (UKH).

The trade body made the call to the Government as part of its list of measures in response to the All Party Parliamentary Beer Group inquiry on pubs’ business rates and the Government’s ‘Business Rates Review: Technical Consultation’.

UKH said the sector overpaid by £2.4bn relative to its turnover pre-pandemic and that must change.

Proposals for change

Alongside the demand for the introduction of a hospitality (or high-street) multiplier for 2023 and an online sales tax to make up the loss of revenue from such a multiplier, its proposals include an urgent investigation into whether the current pub valuation methodology is fit for purpose; better resourced pub valuations that take into account over-trading, the location of a property and historical changes; a halt to reforms to the appeals system to ensure businesses, particularly SMEs (small and medium enterprises), have access to reasonable recourse for errors in valuation; and a reduction in the administrative burden that Government intends to place on business.

UKHospitality chief executive Kate Nicholls said: “The hospitality industry has been hit hard by the pandemic and needs further support and reforms in order to be able to fully recover. We need a new business tax rate for high street businesses that recognise the extra cost that hospitality businesses face.”

Ever-higher burden

She continued: “The current Government proposals around business rate reforms put an ever-higher burden on businesses and will prevent hospitality operators from investing in their businesses, creating jobs and providing services that lie at the heart of their local communities.

“Property taxes in the UK are already nearly double the EU average and, as a proportion of turnover, hospitality pays four times more than the average sector, this is clearly an unfair burden to place on an industry that has been hit hardest by the pandemic.

“Hospitality is the future of the high street and the reform of business rates will play a key part in this, helping the industry to deliver great places to live, visit and to aid the sector play its full role in driving the UK’s economic recovery.”

Related topics: Legislation

Related news

Show more