The UK's hospitality sector is one of the country's greatest economic assets. It is the flagship industry of the UK economy, contributing £3.4 billion to the Exchequer, enabling and supporting public service throughout the UK. It is also one of the UK's largest employers, supporting more than 3.5 million jobs across restaurants, pubs, hotels, cafés, visitor attractions and event venues. From your local restaurant and neighbourhood pub to hotels, visitor attractions and event venues, hospitality is the beating heart of communities across the country, creating opportunities for people of all ages and skill levels while driving local economies.
Yet despite its enormous contribution, hospitality is the most heavily taxed sector in the UK with 75% of all profit plashed back to the Treasury. At 20%, the UK's VAT rate on hospitality is one of the highest in Europe — nearly double the 10% rate applied in France, Spain and Italy, and almost three times Germany's 7% rate.
This is not just unfair — it is holding Britain back.
High VAT makes it harder for businesses to invest, grow and create jobs. It makes dining out, overnight stays and leisure activities more expensive for the end consumer. And it places UK hospitality at a significant competitive disadvantage, with international visitors increasingly choosing Paris, Milan, Madrid and elsewhere over London.
The evidence is clear — when VAT was temporarily reduced during the pandemic, the sector responded immediately, with revenue recovering to 10% above pre-pandemic levels. Lower VAT works. It stimulates spending, creates jobs and generates more tax revenue for the Treasury.
We are calling on the Government to act — and we need your support.
A permanent reduction in hospitality VAT to 10% would improve competitiveness, support businesses, lower prices for consumers and help unlock growth across every region of the UK.
Because when hospitality thrives, Britain thrives.
