Yesterday, the UK government announced that VAT for the hospitality sector will be reduced from 20% to 5%, from next Wednesday until January 12th 2021.
Discounts for people eating out in August were also announced.
Rishi Sunak told the Commons: “Meals eaten at any participating business, Monday to Wednesday, will be 50% off, up to a maximum discount of £10 per head for everyone, including children. Businesses will need to register, and can do so through a simple website, open next Monday. Each week in August, businesses can then claim the money back, with the funds in their bank account within five working days.”
In Wales, the sector has tentatively welcomed the news, but reiterated the urgent need for Welsh Government to provide a timeline on inside opening.
Debs Lewis, co-founder of Dusty Knuckle Pizza in Cardiff, said:
“Those in hospitality will breathe a sigh of relief at the VAT reduction announced today, but a date for inside opening and a timeline for how to get there remains the top priority and would make the biggest difference for the sector in Wales.”
Simon Wright, independent restaurateur, broadcaster and food writer, speaking on behalf of the Welsh Independent Restaurant Collective, said:
“Our view is we’ve heard from the Chancellor, now we need to urgently hear from the First Minister. We welcome the clear recognition from the Chancellor that hospitality needs additional support. However, in Wales, it all relies upon us being open; the First Minister needs to end uncertainty and provide hope to the thousands of small businesses that are waiting to hear from him.”
And speaking last week, Shumana Palit, co-founder of the Ultracomida Group who own two deli-restaurants in Narberth and Aberystwyth, as well as Curado Bar and Vermut in Cardiff city centre, highlighted the problem with outdoor-only opening, saying:
“After weeks of waiting for an announcement, to have only outdoor spaces allowed to open from the middle of July is heart-breaking for us as a business, as we don't have any outdoor space. It makes no difference for us at all.”
Earlier this week, the Welsh Independent Restaurant Collective warned of 30,000 job losses in the hospitality sector unless urgent action was taken. The survey was carried out on 4-5 July, at a time when Wales is the only UK nation without a date for reopening.
The survey revealed that within the 102 businesses that responded, 434 jobs had already been lost, with a further 452 planned – giving a total of 886 job losses from just that sample. Multiplied by the scale of the sector in Wales, and the total number of jobs losses is estimated to be in excess of 30,000.
UPDATE: At the First Minister’s Questions yesterday afternoon, First Minister Mark Drakeford reiterated that indoor hospitality would not reopen on 13th July, and again stated that an opening date announcement would be dependent on the sector first ‘proving’ that it could open safely in the outdoors.