The CEO of HOSPA, the Hospitality Professionals Association, has responded to Rishi Sunak's Budget 2021.
Jane Pendlebury (pictured) said, 'The budget was very much a mixed bag for hospitality in what was a largely optimistic and positive budget for many. Our main hope though, as a sector, was for the VAT rate to stay at 12.5% for hospitality – with the planned April increase scrapped.
'But despite strong lobbying from the industry, this didn’t materialise and it’s a considerable blow for our ongoing recovery considering the many other issues buffeting the sector. Staff shortages, inflated food and drink prices, the supply chain, even energy costs – all are heavily impacting already fragile hospitality operators up and down the country.'
Pendlebury continued, 'This blow has been somewhat softened by certain measures – particularly the 50% business rate discount, which is hugely welcomed, while other moves such as the cancellation of a rise in alcohol duty and the draught relief offer positivity for pubs, bars and restaurants to seize upon.
'However, whilst by no means a disastrous budget, maintaining the VAT rate at its current level would have offered the biggest boost for the sector – and it’s one that it very much needs.'
Pendlebury concluded, 'Proper government support is essential if hospitality operators are to successfully navigate volatile post-pandemic waters. At present, forecasters will need to factor in a rise in VAT in April – and I’m sure many will wince when they see the tightness of their margins.
'We urge the Government to do what’s needed to secure and shore up one of the UK’s most important sectors – and whilst they’ve offered some support, I don't believe it goes far enough.'