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Pressure mounts in the South West for government to cut tourism VAT
10:00am Thursday 19th June 2014 in Devon
SUPPORT is growing in the South West for a national campaign to reduce the rate of VAT for the tourism industry, piling pressure on the Coalition government to help the regions single largest employer.
A steadily growing number of politicians and local businesses have spoken out against the current 20% rate, and backed the CUT Tourism VAT Campaign, which lobbying for a reduction to 5%.
One of those urging a cut is Adam Fox-Edwards, Managing Director of the Arundell Arms, a hotel in the small village of Lifton, near Oakhampton.
Currently, Adam employs 20 full-time staff and 30 part-time staff, all locally drawn.
Appearing on BBC Sunday Politics South West, he said: “The industry will respond very quickly: [a cut in VAT] will bring on more people staying in hotel rooms, more people therefore eating in restaurants, bars, pubs and so on in the West Country, hopefully more overseas visitors coming inbound, and fewer of the UK citizens going outbound - so it’d be very good for our local economy.”
Geoffrey Cox, MP for Torridge and West Devon (Con), whose constituency includes Lifton, said: “It is going to send an electric shock of aid and assistance and support for the domestic tourism industry. That’s what we need to do, it’s a vital industry for the South West and that’s why I am urging the government to take action.”
In a recent House of Lords debate held on the 12th June, Labour Peer Lord Harrison said the government does not ‘get’ tourism.
Many of the supporters want the UK tourism industry to be able to compete on a level playing field with Europe, where 24 out of 27 countries already have reduced rates of VAT.
The average rate of VAT applying to visitor accommodation in the EU is 10.8% - just under half of the UK rate. The UK rate on attractions is also nearly a third higher than the current European average of 15.7%. As a result, UK residents spend more in tax on domestic holidays than their European counterparts.
Plymouth City Councillor Bill Stevens (Lab), said: “In a city like Plymouth... the largest city on the south coast, we rely heavily on tourism. We have something in the region of five million expected visitors, and growing support for the tourism industry is vital. If we can do anything to help hoteliers and people involved in the tourism industry, that would be fantastic.”
A cross-party group of 28 MPs from across the country are have signed an Early Day Motion (EDM) calling on the government to reduce the rate of VAT on the tourism industry, in order to boost regional economies outside London.
The EDM was tabled by Margaret Ritchie, SDLP MP for South Down, and has been sponsored by Peter Bottomley, Worthing West, Bob Russel, Colchester, Caroline Lucas, Brighton, Mark Durkan of Foyle and Jim Shannon, Strangford.
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