UKHospitality: A nightmare before Christmas?

If 2024’s budget was a Halloween horror, this year’s looks set to be a nightmare before Christmas for the hospitality sector. It’s not long until the chancellor unveils her 26^th November ‘fiscal event’ on our already suffering industry, so UKHospitality continues to urge businesses across the sector to call for a budget that helps hospitality, rather than one that damages it further.

Almost 85,000 hospitality jobs have been lost since last October’s budget. Similar losses after this year’s could be catastrophic, not to mention the terrible harm further tax rises would inflict. So, we’re imploring the chancellor to include these essential measures in her forthcoming Budget: fix National Insurance Contributions (NICs), lower business rates and cut VAT.

Fixing NICs would boost jobs by extending existing exemptions to young and old, plus those moving from welfare to work. Changing NICs was a regressive move, having had a disproportionate effect on entry level jobs. Unless the government changes its approach, our sector could be facing at least 150,000 fewer workers.

Then there’s VAT. A cut, like the one that so helped thousands of hospitality businesses during Covid, would help drive investment by bringing us into line with many of our European rivals.

We’re also calling on the government to give our declining high streets a much-needed lift by lowering business rates through a 20p maximum discount for hospitality businesses under £500,000 rateable value. This maximum discount should be implemented alongside a commitment that no hospitality property above £500,000 pays higher rates.

Together, these changes are vital if our industry is to create jobs. Otherwise, things will only get worse. Right now, one in three hospitality business have introduced restricted opening hours, four in 10 have slashed investment, while six in 10 have reduced staff hours. And let’s not forget the massive tax burden we already shoulder, paying more tax than any other sector – a thumping 71% of pre-tax profit.

So, as we enter the final furlong, UKHospitality is calling on all hospitality businesses, big and small, to help drive home this pre-budget message to the Chancellor, via our #TaxedOut campaign.

Our website has a toolkit that makes it easy for operators and venues to write to their MP, print and display our poster, and promote the #TaxedOut campaign via social media. Writing to your local MP, even at this late stage, is something we’d particularly encourage – strength of feeling is something they do take notice of, especially when expressed by thousands.

Ever-increasing costs being heaped on our sector is totally unacceptable and is stopping hospitality from playing its role as the industry best able to lead the way when it comes to delivering jobs, while at the same time driving the wider UK’s economic recovery. Please, then, do all you can in the run-up to 26^th November – because a second damaging budget won’t just be ruining Christmas.

You may also be interested in…