Tourism minister backs VAT reduction on hotels

Tourism minister backs VAT reduction on hotels

New tourism minister Tracey Crouch supports a key demand of the UK domestic and inbound sectors.

Crouch has argued in Parliament that VAT on accommodation be reduced to 5%. The MP for Chatham and Aylesford in Kent was appointed minister for tourism and sport at the Department for Culture, Media and Sport (DCMS) this week.

In January, Crouch posed a question to Sajid Javid, then secretary of state at DCMS, asking: “What conversations has the secretary of state had with the Treasury about the benefits of a future cut to VAT?”

She argued: “Tourism VAT rates across the EU are much lower than in the UK and if VAT on accommodation was reduced to 5% that would boost jobs and bring a further £1 million into Kent.”

In reply, Javid said he was in “ongoing discussion with the Treasury” on the issue. He described Crouch as “passionate” about reducing VAT.

Javid was appointed secretary of state at the Department for Business, Innovation and Skills this week.

The British Hospitality Association (BHA), UKinbound, the Tourism Alliance and other bodies have campaigned for VAT on accommodation to be cut to 5%.

BHA chief executive Ufi Ibrahim welcomed the appointment of Crouch and of new DCMS secretary of state John Whittingdale this week.

Whittingdale chaired the Commons select committee on culture, media and sport in the last Parliament and Crouch was a member of the committee.

Ibrahim said: “We look forward to working closely with John and Tracey especially in leading the delivery of recommendations to reduce tourism VAT.

“The time has come for the hospitality industry to be empowered to help our economy reach its potential with more jobs, visitors and tourists across the UK.”

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