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Temporary VAT cut for hospitality sector

21 July 2020 / Neil Warren
Issue: 4753 / Categories: Comment & Analysis
24565
Summer treats

When I heard about the temporary VAT reduction from 20% to 5% for the tourist and hospitality industry my initial reaction was similar to that of Brenda from Bristol when she was told about the general election being called in 2017: ‘Not another one.’ I was thinking about the last time a chancellor tinkered with VAT in 2012 – George Osborne’s infamous ‘omnishambles Budget’ sometimes referred to as ‘pastygate’.

However I am pleased to report that HMRC’s detailed guidance and the sensible way the latest changes have been dealt with render my fears groundless. There will though be some grey areas as is inevitable with any new tax law.

Three categories

The best way of looking at the changes is to divide them into three categories:

  • food and drink sales – pubs cafes restaurants members’ clubs...

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