Cut tourism VAT campaign stirs Backbench rebellion

Politicians across the UK have come out in support of the Cut Tourism VAT campaign, which wants VAT on hotels and attractions to be cut to 5 percent. Over 60 MPs are now in support of the campaign.

New research on the way

The hospitality and tourism industry has come together in a bid to drive investment and jobs in regional towns, and is set to launch new research next week which will further underline its economic case.

The aim is to make Britain more competitive, cut prices and create over 120,000 jobs while adding around £4bn to economic output. There would be an initial hit to the Treasury but this would be made back inside one parliamentary term.

Most EU states have already cut VAT rates

Now ministers have been forced to admit that the change can be made without prior approval from the EU after it was revealed that the majority of EU states have all cut their holiday VAT rates.

As well as a public campaign, bolstered by support in The Sun this week, a parliamentary motion tabled two weeks ago by Margaret Ritchie, SDLP MP for South Down, has also generated support in Westminster.

Holiday-makers in Northern Ireland – where Game of Thrones was filmed – face the ridiculous situation of paying 20% VAT but only 9% when venturing south into the Republic of Ireland – which has used its right to make the cut.

Early Day Motion in House of Commons 

The EDM can be viewed here. It says:

• Tourism-related businesses lie at the heart of the local community and economy;
• 24 (soon to be 25) out of 27 EU member-states, including the Republic of Ireland, take advantage of a reduced rate of VAT for tourism, increasing investment and jobs;

·         As a result many UK regions depending heavily on tourism suffer a significant competitive disadvantage against EU states;

·         Research using HM Treasury modelling showed increases in UK GDP by up to £4 billion each year;

• Calls on Government to introduce a sector-specific VAT reductions for tourism-related products, including accommodation and attractions, recognising such a move would strengthen the wider economy, support job creation and generate investment in local businesses

Full current list of 63 MP supporters