UK Tax News: VAT cut down for hospitality & tourism sector
The Chancellor announced a reduction in VAT rate for the hospitality and tourism sectors in this epidemics situation.
UK VAT Rate Reduced
This temporary reduction in VAT rates from 20% to 5% would be maintained till March 31, 2021 instead of January 13. He said the move would “help secure 2.4m jobs in the winter”.
Restaurants particularly affected by the lock down measures, and thousands of jobs already lost in the sector. The provisional VAT cut was first introduced in July and was designed to help hotels, restaurants, cafes and pubs financially.
Price Reduction by Businesses
However, some businesses in private sector, such as KFC, Nando and Pret, have decided to offer savings directly to consumers by lowering prices in their stores.
The chancellor said that the VAT cuts would help “more than 150,000 businesses” over the winter.