Britain cuts value-added tax to 5% for hospitality sector

Britain will cut value-added tax (VAT) on spending on hotels, restaurants and tourist attractions, and subsidise temporary discounts on eating out, to boost demand for services hardest hit by the COVID-19 lockdown, finance minister Rishi Sunak said on Wednesday.

Britain will cut value-added tax (VAT) on spending on hotels, restaurants and tourist attractions, and subsidise temporary discounts on eating out, to boost demand for services hardest hit by the COVID-19 lockdown, finance minister Rishi Sunak said on Wednesday. The standard 20% rate of VAT will be lowered to 5% from next Wednesday until Jan. 12, 2021 for the hospitality and domestic tourism sector at a cost of around 4 billion pounds, Sunak told parliament during a statement on the outlook for the economy.

Separately, Sunak said the government would subsidise half-price restaurant meals served on Mondays, Tuesdays and Wednesdays in August. British high-street retailers, as well as pubs and restaurants, have so far seen only around half their customers return as lockdown measures have been partially relaxed in recent days and weeks.