Plans to recover the hospitality sector - Mini Budget 2020

The chancellor has today announced two new measures to help the hospitality sector recover from the devastating effects of coronavirus on the industry.

From 15 July the VAT rate on food and accommodation will be reduced from 20% to 5%. This will mean a meal currently costing £50, from 15 July will cost £43.75. The 5% VAT rate will apply until 12 January 2021 but excludes alcoholic drinks.

Secondly, throughout August 2020, diners eating out on a Monday, Tuesday or Wednesday will receive a 50% discount on their meal, restricted to a maximum discount of £10. Businesses will be able to register for the scheme from Monday and they will be able to make a weekly claim throughout August with funds being remitted to them within five days.

These measures are hoped to encourage consumers back into restaurants, pubs and hotels to restart the hospitality sector which forms such a massive part of the UK economy. In addition, this sector includes a large proportion of employees below the age of 25 and so this will also assist in getting young people back into work alongside the additional plans Sunak put forward in his Mini Budget to aid the job market. See my colleague Kerry Whitfield's article on this. 

If you would like any advice on the measures introduced, please contact me, Samantha Daniels on 01865 292233 or via samantha.daniels@shawgibbs.com