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Hospitality Businesses

Volume 734: debated on Tuesday 20 June 2023

Hospitality businesses play an important role in local communities and the UK economy. They will benefit from business rates support worth £13.6 billion over the next five years, which includes increased generosity from the retail, hospitality and leisure relief scheme from 50% to 75% in 2023-24. There is also our Brexit pub guarantee, which means that the duty on a draught pint in a pub will always be lower than its equivalent in the supermarket.

The Minister will be aware of long-standing calls from the sector to reduce VAT to bring it into line with European equivalents. Will the Treasury undertake an assessment of the economic benefits of doing so? Will it consider that as part of a package, alongside increasing the threshold for VAT registration from £85,000 to £100,000 to support smaller businesses?

The hon. Gentleman poses many questions for me, some of which are very complicated. VAT relief for the hospitality sector was important in the aftermath of the pandemic, but it cost us a great deal of money and we have had to raise it back up to 20%. We keep the other VAT matters under review, and I would be delighted to meet him to discuss the complexities behind them.

A great many of the new job opportunities and career paths being created in Pembrokeshire are in the tourism and hospitality sector. Does my hon. Friend agree that the very last thing that business people who are creating those growth opportunities need right now is a tourism tax of the kind being brought forward by the Welsh Labour Government in Cardiff, which will hit businesses with new burdens and raise the cost of going on holiday in Wales?

The sun always shines in my right hon. Friend’s corner of Pembrokeshire when he speaks up for it. He is quite right to identify how the Conservatives in Government are trying to help businesses through our business rates relief in England, through our energy support scheme over recent months and, of course, through the Brexit pub guarantee. Welsh Labour, on the other hand, wants to call last orders and have higher taxes for the businesses he is so keen to support.

The 2019 Conservative manifesto, some three Prime Ministers and four Chancellors ago, promised a fundamental reform of business rates. This is another broken Tory promise. Will the Minister admit that only a Labour Government will end the chaos, scrap business rates and replace them with a fairer system, so that our amazing hospitality sector can thrive and grow faster?

I have a great deal of respect for the hon. Lady, but I must point out to her gently that we have, in fact, conducted that review. In the autumn statement, we were able to announce a £13.6 billion package of help over the next five years, including a multiplier freeze for all ratepayers, large and small; a transitional relief cap funded by the Exchequer; retail, hospitality and leisure relief; and a small business support scheme, which will help to cap bill increases at £600 per year for any business losing eligibility for some or all small business rate relief or rural rate relief at the 2023 revaluation. We have done that review and are supporting businesses that need help.