Hospitality in the News

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Your latest instalment of articles and opinions from across the hospitality sector.

Thinking differently

The much anticipated UK Budget was announced yesterday and, from a hospitality sector perspective, it was pretty positive but with a sting in the tail. We were pleased to see the UK Government is continuing to support the sector by maintaining a reduced 5% rate of VAT for hospitality until September 2021, when an interim rate of 12.5% will apply until March 2022 and after which the standard 20% rate will apply again. There was further good news as the Chancellor announced that the business rates holiday in England will continue until June 2021 with a discount to two thirds of the normal rate for 6 months after that. Hospitality businesses can also apply for a "Restart" grant of up to £18,000 to help them get going again now that restrictions are easing. However, the not so good news was that the Budget included an increase in the corporation tax rate to 25% from 2023 (though with a £25bn “super deduction” two-year tax break which would allow companies to deduct 130 per cent of their investment from taxable income). Finally, the Chancellor signalled the bulk of the bill for COVID-19 is yet to come – it was very much spend now, tax now and (even more) later.