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Hotels (Government Assistance)

Volume 477: debated on Thursday 6 July 1950

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asked the President of the Board of Trade whether he is aware that hotel-keepers who are seeking to attract foreign tourists are handicapped by Purchase Tax on hotel equipment; and whether he will give them any relief.

The Government recognise that the cost of hotel equipment is at present high and that the incidence of Purchase Tax makes it an especially heavy burden for the hotel-keeper. They are particularly anxious that this circumstance should not stand in the way of the provision of more and better accommodation for tourists from the dollar countries of North America, especially in the Festival year 1951. Accordingly, after consultation with the British Travel and Holidays Association and representatives of the hotel industry, the Government have decided, as an exceptional meaure, to make a contribution for one year only towards the cost of equipping or re-equipping dollar-earning hotels during the current financial year.

Contributions will be made under two heads:

  • (1) in respect of expenditure incurred during the year ending the 31st March, 1951, on well-thought-out and comprehensive schemes for the initial equipment or re-equipment of hotels which, in the opinion of an independent advisory committee, will be likely substantially to increase or improve the accommodation available and suitable for American and Canadian visitors. Exceptionally, large schemes of capital equipment which cannot be completed by 31st March, 1951, may, if approved by the date, be eligible for contributions in respect of expenditure incurred up to a reasonable date thereafter;
  • (2) in respect of replacement expenditure during the year ending 31st March, 1951. In this case the amount of the contribution will be related to the proportion of the hotel's bedroom capacity actually occupied by American and Canadian visitors during the calendar year 1951.
  • The details of these arrangements, for which the Board of Trade will be responsible, will be worked out as quickly as possible, in close consultation with the British Travel and Holidays Association and the hotel industry.