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Visit Britain criticised for failing to address VAT on hospitality

01 May 2013 by
Visit Britain criticised for failing to address VAT on hospitality

The Cut Tourism VAT Campaign has criticised Visit Britain for failing to properly address the case for a VAT reduction on hospitality in its new tourism strategy.

The strategy aims to attract 40 million international visitors a year, spending £31.3b, by 2020. It sets out four key pillars: to enhance Britain's image, ensure that Britain is packaged and sold more widely, broaden Britain's product offering and make visiting Britain easier.

But Cut Tourism VAT Campaign chairman Graham Watson said the tourism body had sidestepped the example set by European competitors in ignoring calls to enhance Britain's competitiveness through a VAT reduction.

He added: "Whilst the campaign applauds the report's call for a ‘long-term ambition for growth' we are disappointed industry submissions making the case for a VAT reduction for the sector were not given more consideration.

"The report accepts that other countries have recognised the potential of tourism to contribute to employment and growth and are adjusting their policies accordingly in order to compete internationally.

"It is therefore surprising that our proposed VAT reduction, which would bring us into line with our EU competitors, is not given due attention in this report. According to the Treasury's own economic model this proposal is one of the ‘most efficient' ways of generating GDP growth at low cost.

"Government could quickly implement a reduced rate of VAT to help industry competitiveness. Other proposals, such as delivering new airport capacity would take many years to be realised."

So far more than 500 hospitality groups, associations and businesses have lent their support to the campaign, which seeks a level playing field with the UK's tourism competitors.

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