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Published on : Wednesday, November 27, 2013
UK Ministers are under pressure to follow the lead of France, Germany and Ireland by slashing VAT on food and accommodation to boost one the country’s most vital industry.
But junior Treasury Minister David Gauke in a written ministerial question said there is “no prospect” of a tax break as increasing Government borrowing could have a “far larger negative impact on the economy”.
The CutTourismVAT campaign, consisting 500 groups, associations, individual hotels and attractions, is leading demands for a cut to improve the industry’s international standing and help ease the cost of living burden for tourists.
The tourism sector in Britain is subject to a 20% VAT rate, while in some countries in Europe it is just 7%. Estimates last year claimed reducing the duty to 15% could net them an extra £160 million a year.