Cut Tourism VAT

Cut tourism VAT, boost british jobs


Sunday, 19 October 2014

Coastal politicians urge chancellor to cut tourism VAT to help seaside towns

Politicians from across the UK are urging the government to encourage growth in their constituencies by cutting VAT on tourism

Research using the Treasury’s own model commissioned in July showed cutting VAT on accommodation and attractions would create over 120,000 jobs, add £4 billion to UK GDP each year, and also contribute £4 billion to the Treasury over 10 years.

MPs and parliamentary candidates believe that coastal towns and villages have a central role to play in Britain’s ongoing recovery.

Britain’s high VAT rate compared to European countries makes it expensive for Brits to holiday at home. Tourism – currently Britain’s 6thlargest export, bringing £24 billion each year – is the only export where VAT is levied.

Britain’s VAT rate on accommodation and attractions is one of the highest in the EU, putting British tourism at a serious competitive disadvantage. Campaigners, including some of the biggest names in tourism, want to see the rate cut from 20% to 5% on accommodation and attractions in a bid to stir economic recovery in hard-pressed areas.


Paul Maynard, MP for Blackpool North and Cleveleys, said:

“Places like Blackpool have the potential to be powerhouses of the North West but they are stifled by an uncompetitive VAT rate which leaves us unable to compete with Europe. Our long term economic plan is working but our seaside resorts need to play a role in that recovery. That is why I’m supporting the call for a tourism VAT cut, which will allow businesses in Blackpool to be more competitive, to invest in facilities and create more jobs which will lead to a more sustainable future for a great British industry.”

Ian Liddell-Grainger, MP for Bridgwater and West Somerset, said:

“Part of the government’s long-term economic plan should be reducing VAT for accommodation and attractions, as research using the Treasury’s very own economic model has proven. We all want to create jobs, stimulate growth and generate a fiscal surplus – all things which cutting tourism VAT would do. We need the chancellor to engage and look at a VAT cut in the Autumn Statement.”

Geoffrey Cox, MP for Torridge and West Devon, said:

“Tourism is the lifeblood of Britain’s seaside towns and the economic case for cutting VAT to help these places is as clear as day. Local businesses need a leg up and the chancellor must ensure that coastal communities benefits of our long term economic plan as well as London has. We need to not be hamstrung by anti-competitive tax policies like tourism VAT. There’s now clear proof of a £4bn windfall created by the extra job creation and investment cutting VAT would generate. We have to take a long view and spur on investment in coastal towns.”

Peter Aldous, MP for Waveney, said:

“Seaside towns like Lowestoft, which I represent, continue to face a variety of economic challenges. Tourism is an extremely important local industry and a Tourism VAT cut would bring significant benefits, helping businesses to be more competitive and successful and to both secure and create new jobs. The UK is currently operating with one hand tied behind its back as the majority of European countries having more competitive rates. The economic case for a cut in Tourism VAT, using the Treasury’s own model has been proved and I urge the Government to consider carefully the compelling case which has been made.”

Sir Roger Gale, MP for North Thanet, said:

“When Lithuania cuts VAT for its tourism industry next year, Britain will be just one of just a handful of EU countries without a reduced rate for its tourism sector. We must take advantage of European regulations that allow us to cut VAT, and make sure that Britain is competing for visitors and holidaymakers on a level playing field. Tourism is one of our most successful job-creating industries and it should not have to operate at a disadvantage.”

Guto Bebb, MP for Aberconwy, said:

“Hotels and B&Bs in my constituency often shut shop for the winter to avoid going above the VAT threshold, which they would have to pay at a 20 percent rate – far higher than hotels, caravan parks and the like pay in Europe. Welsh tourism businesses need to be on level playing field with their European competitors, and that means cutting VAT for the industry.”

Graham Cox, PPC for Hove, said:

“The evidence is building to suggest that a cut in VAT on tourism would boost both jobs and growth. This seems to have happened in other EU countries which have done this, and I am therefore supporting the campaign for a similar cut to be introduced here. The tourism industry is crucial to Hove and Brighton and would benefit from this support.”

David Warburton, PPC for Somerton and Frome, said:

“Not only is tourism is a key part of our economy here in the South West, but it plays a vital role in showcasing our spectacular rural landscape and bringing thousands of visitors each year to enjoy our vibrant towns and villages. We must support this industry and ensure that it continues to grow and thrive. A five per cent reduction in VAT on tourism would add a staggering £4.5 million economic boost to the Somerton & Frome constituency, with long lasting benefits for us all. I’m keen to help make it happen.”


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Notes for editors

Comparison of EU VAT rates:

Tourism industry stats taken from Visit Britain report with Deloitte and Oxford Economics:

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