A York hotelier is calling on the Chancellor to use his budget to cut VAT in the tourist sector.
Graham Usher, general manager of the Monkbar Hotel and chair of York Hoteliers Association, said the future of many small hotel was far from certain due to a “triple-whammy” increase in business rates, the Living Wage and the introduction of auto-enrollment pensions.
Mr Usher, pictured, said: “Across most of Europe the VAT rate for tourism is five per cent, and we could do with a VAT tax break in this country. Food in supermarkets has a zero VAT rating because it is ‘cold’, but we have to charge VAT at 20 per cent, which is ridiculous.
“The Chancellor needs to recognize the importance of our industry to the economy, and instead of increasing the financial burden, he needs to lessen it.
“The auto-enrollment pension scheme has added tens-of-thousands-of-pounds to our annual operating costs alone. If businesses are forced to pass on these increases to their customers, the result will be a drop in trade.
“A hefty increase in business rates that many are going to experience will sadly lead to smaller establishments shutting up shop for good.
“One way to counter this is to bring our VAT rate into line with other European countries. Whilst York’s tourism industry is flourishing, we still need to remain affordable and competitive.”