JD Wetherspoon chairman Tim Martin is calling on pub and restaurant operators to show their support for a UK-wide Tax Equality Day on Thursday 13 September.
He has the backing of leading industry organisations, UK Hospitality and the British Beer and Pub Association (BBPA), that are calling on their members to join in too.
Each of Wetherspoon’s pubs in England, Wales and Northern Ireland will be cutting the price of all food and drink by 7.5% on the day. Its pubs in Scotland will offer customers a 7.5% reduction on all food, soft drinks and hot drinks.
Tax Equality day is aimed at highlighting the benefit of a VAT reduction in the hospitality industry. Prices at Wetherspoon pubs will be reduced for one day only, in order to show the benefits of a VAT cut.
At present all food in pubs is subject to 20% VAT, compared to supermarkets, which benefit from a zero VAT rate on the vast majority of food products.
Martin said, “Pubs suffer a huge disadvantage paying about 16 pence in business rates per pint versus about two pence for supermarkets. In addition, there is a huge VAT inequality and unfairness.
“A reduction in the level of VAT on a long-term basis will create a level playing field and generate growth and jobs in an important and vital industry – especially in beleaguered high streets.
“We’re aiming to make it the busiest day of the entire year in our pubs and would urge other pub and restaurant operators to participate too.”
UK Hospitality Chief Executive Kate Nicholls, said, “Tax Equality Day is a great way to highlight just how hospitality businesses are disproportionately hit by VAT.
“The tax disparity between the hospitality sector and supermarkets is still far too high. Pubs are paying around a third of their turnover in tax compared to a fifth for big supermarkets able to sell alcohol at very cheap prices.
“A cut in the rate of VAT for the hospitality sector can help address this unfairness and allow pubs and bars to invest in their businesses and staff members.
“We hope that everyone will support this year’s Tax Equality Day and send a clear and unequivocal message to the Chancellor to give the sector the VAT cut it deserves.”
And BBPA Chief Executive Brigid Simmonds added, “Cutting the tax burden on pubs should be a top priority for the Government.
'We welcome this Tax Equality Day initiative as a way of reminding customers that our pubs are over-taxed and we need action now to hold down the cost of going out.
“VAT reform is long overdue and beer duty and business rates are disproportionately high for pubs in the UK.”
Nigel Evans, MP for Ribble Valley, said, “The hospitality campaign to recognise tax equality is a welcome and much anticipated event which now resonates with our national consciousness.
“This year’s Tax Equality Day has a special significance as it could be the final year before it achieves its goal as a result of the tax cutting freedoms which Brexit will endow the government with.”