Sunak announced a VAT cut from 20 per cent to five per cent for accommodation and attractions, running through from July 15 to January 12, 2021. The reduced rate applies to accommodation and admission to attractions across the UK, with further details due in the coming days. Also due is a temporary cut in VAT to five per cent on food and non-alcoholic drinks from restaurants, pubs, bars, cafés and similar premises. BACTA CEO John White said: “While the cut in VAT to five per cent went beyond what we had asked for, it is far more circumscribed than the Chancellor led us to believe. It only applies to accommodation and the entry price to visitor attractions and is not an across-the-board cut to help the whole industry.”

BACTA’s CEO John White.
White added: “On food and drink, it is not entirely clear whether the VAT cut applies to takeaway food. The Chancellor recognised tourism businesses have been among the mostly badly hit industries yet didn’t extend the VAT cut to one of its key sectors - the seaside arcade. He must now cut MGD to five per cent to help us get through the winter. Sunak also announced a job retention scheme featuring a one-off payment of £1,000 to employers for every furloughed employee who remains continuously employed through to the end of January next year. The £1000 bonus for those previously furloughed employees that are employed through to the end of January 2021 looks like it could be a helpful boost to payroll costs, but again we must await more details.” (2020/07/29)