Wetherspoons is to cut the price of all food and drink at its 900 pubs by 7.5% on Wednesday 20 September to highlight claims that VAT reduction would benefit the hospitality industry.
Tax Equality Day aims to highlight how food and drink in pubs is subject to 20% VAT. However, supermarkets are not required to pay VAT on their groceries.
According to Association of Licensed Multiple Retailers’ (ALMR) chief executive, Kate Nicholls, who is also backing the campaign: ‘This saving allows huge supermarkets to sell other goods, such as alcohol, at a discounted rate.’
Wetherspoons and trade groups such as the ALMR and British Beer and Pub Association (BBPA) are calling for a cut in the VAT rate charged. According to the BBPA the pubs and restaurant sector could create 78,000 new posts, if sales tax were cut from 20% to 15%.
‘We are proud to support the campaign to reduce the level of VAT within the pub industry,’ J D Wetherspoon founder and chairman, Tim Martin, said. ‘Customers coming to our pubs on Wednesday 20 September will find the price of their food and drink is lower than normal. We are keen to highlight the amount customers would save if VAT in pubs was lowered permanently. So, for example, the total price of a meal and drinks for a customer would be reduced from £10 to £9.25 on Tax Equality Day.
‘Creating tax equality between pubs, restaurants and supermarkets will fulfil many government objectives including the creation of more jobs. It is a win win situation for the government and our industry.’