Campaign to cut tourism VAT makes its case to chancellor ahead of the budget

12 March 2013
Campaign to cut tourism VAT makes its case to chancellor ahead of the budget

The British Hospitality Association's campaign to reduce tourism VAT has published it's submission to HM Treasury ahead of next week's Budget statement.

It has called on the chancellor to reduce the rate of VAT on visitor accommodation and attractions to 5% and included research which has found that such a move would result in an extra £4b a year through increased visitor numbers to the UK.

The research used the treasury's own economic Computable General Equilibrium (CGE) model to prove the assertion.

Professor Blake, a treasury adviser who completed the research, said that cutting tourism VAT to 5% represented "one of the most efficient, if not the most efficient, means of generating GDP gains at low cost to the Exchequer that I have seen with the CGE model".

Other independent work by Deloitte has also found that the reduction in VAT would create 80,000 jobs.

Graham Wason, chair of the campaign said: "At this Budget the chancellor needs to takes actions which will stimulate growth, reduce our imbalance of payments and support job creation.

"Our submission lays out the strong evidence that a VAT reduction for accommodation and attractions would be one of the most effective and affordable methods for the Government to achieve these goals."

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