Thousands of pubs and restaurants lower prices to campaign on VAT

Nearly 15,000 pubs and restaurants are joining a campaign to cut food and drink prices by 7.5% to demonstrate how a VAT cut for the sector would boost consumer spending.

Big brand venues such as JD Weatherspoon, Pizza Hut and Punch Taverns have joined the campaign which kicks off today.

“Tax Parity Day” is the brainchild of French hospitality businessman Jacques Borel who says a reduced VAT rate of 5% would generate £1.5bn in tax revenue and create over 600,000 jobs.

Borel website states: “The hospitality sector makes a major contribution to the British economy. It is a sector that can generate jobs fast – more sales = more jobs. We will see the positive impact of a VAT cut within a matter of months.

“Plus, in reality, the government will recoup most of the cost of the VAT reduction from other taxes generated by the jobs that will be created, increased sales and higher corporation tax receipts. We expect this new revenue will more or less balance out the VAT cut within three years.”

Pubs and restaurants pay 20% VAT on food and drinks while supermarkets pay 0%. The campaign criticises the current state of play.