BHA lobbying for reduced VAT rate

The British Hospitality Association (BHA) recently shared its decision to actively lobby the government to lower the VAT rate for the hospitality industry within the next two-three years.

The BHA argues that most other European countries already have lower VAT rates for accommodation, attractions and restaurant meals, which makes the UK – with a rate of 20% - a less-than-competitive destination.

VAT rates for tourism-related businesses in other European countries can be as low as 5.5% in France, 7% in Germany, 8% in Spain and 10% in Italy. Ireland has also recently announced that effective from July 1st this year, the VAT rate for hospitality would go down to 9%.

The BHA worries that the higher VAT rate deters both inbound tourism and national tourism, with both British citizens and overseas tourists deterred from coming to the UK because of the higher prices.