Sacha Lord has launched a campaign to reverse the hospitality VAT increase in light of the move to Plan B restrictions and the slew of cancellations suffered by pubs, restaurants and hotels.
Manchester's Night Time Economy Advisor said 83% of venues have reported cancellations in light of the move, adding that the northern ‘red wall' would be particularly hard hit, being home to a higher proportion of hospitality businesses than the national average.
The government increased VAT on hospitality from 5% to 12.5% on October 1 2021, with a further increase to 20% set to come in from 1 April 2022.
Lord said: "Britain's pubs, cafes, restaurants, and hotels have already suffered immense damage since March 2020. Sales across hospitality are around half what they were in 2019, and the sector remains in crisis mode. Yet for some unfathomable reason, this government plans to practically double VAT for hospitality businesses, putting at risk the survival of 12,600 businesses, forcing them to raise prices for consumers and six in ten of them to cut jobs."
He added: "This Tory tax rise is a ‘red wall' tax on working class northerners, plain and simple. It will hurt the poorest in our society more than anyone else, eating into the disposable incomes of the UK's poorest ten percent of people three times more harshly than the richest ten percent.
"I'm not sure why it's left to me to tell a Conservative government not to raise taxes, but the road we are going down will do nothing but stifle investment, economic growth and recovery."
Hospitality businesses have told The Caterer they are seeing cancellations of Christmas parties coming in "thick and fast" following the prime minister's announcement of further coronavirus restrictions earlier this week.