The Sun calls for a VAT cut on UK holidays

stephen gilbertAfter the energetic debate in these columns over the photo of Nick Clegg holding the free World Cup edition of the Sun, it is, shall we say, interesting to be able to report a Lib Dem MP praising that newspaper for a campaign it is running.

Stephen Gilbert, the MP for St Austell & Newquay, in the holiday county of Cornwall, is quoted as supporting the Sun’s petition to cut VAT on holidays in the UK. He says:

Thanks to the hard work of people across Britain, our economy is now turning a corner.

And a VAT cut for those who holiday in Britain would be a great way for the Government to recognise and reward the effort that people have put in over recent years.

I commend the Sun for launching this campaign and look forward to working with them to get the Government to make this change.

An Early Day Motion on this has been tabled by Margaret Ritchie. The Sun claims that 60 MPs support it, although only 30 have signed it to date. The text is:

That this House recognises that local restaurants and public houses are facing very challenging conditions in the current economy and are being put under further pressure by the rise of large supermarkets that enjoy preferential value added tax (VAT) treatment; notes that these businesses lie at the heart of their local communities, economically and socially; further notes that 13 EU member states, including the Republic of Ireland, have introduced a reduced rate of VAT within their tourism and hospitality sectors for restaurants and public houses, and 22 have done so for hotel accommodation, and that such measures have had a positive impact; calls on the Chancellor of the Exchequer to introduce similar sector-specific VAT reduction measures to help businesses in the UK; and further recognises that such a move would encourage growth in the wider economy, support job creation and generate investment in local businesses.

* Mary Reid is a contributing editor on Lib Dem Voice. She was a councillor in Kingston upon Thames, where she is still very active with the local party, and is the Hon President of Kingston Lib Dems.

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  • If you argue for tax-cuts without saying where you’re going to increase tax elsewhere then it can only mean that you’re in favour of public spending cuts and a smaller state.

  • Well, the Sun must occasionally hit upon a petition that isn’t blatantly a terrible idea, in a stopped clock twice a day sort of way.

  • If we’re going to lobby for VAT changes, shouldn’t feminine hygiene products get higher billing that luxury products like hotels?

    Seems like a decent idea; although I also think we should set separate duty rates for on- and off- licenses.

  • David Evershed 1st Jul '14 - 4:39pm

    The Government has an annual deficit of £100bn.

    It should be looking at ways of raising more revenue not giving some away.

  • @David Evershead

    The idea is that if you reduce the VAT you’re charging on, say, hotel accommodation for domestic tourists on UK holidays, you promote the use of UK resorts and increase the overall take thanks to increased spending on other things that still attract the full tax.

  • David Evans 1st Jul '14 - 5:21pm

    Also increased takings for British hotels, B&B’s etc results in more profits, corporation tax, income tax etc.

  • David Evershed 1st Jul '14 - 5:45pm


    People only have so much disposable income to spend. If what they spend on hotels and restaurants has a lower VAT then the government will collect less VAT – and the deficit will grow even bigger.

  • What is the alleged “preferential VAT treatment” enjoyed by supermarkets?

    Is it that food items are zero rated? A privilege shared by small shops and farmers’ markets as well as supermarkets!!!

    It seems that Stephen Gilbert’s campaign would reduce the tax take and complicate the tax code.

    A very bad idea – truly worthy of the Murdoch press.

  • Interesting idea, but suspect there may be too many loopholes for it to work properly.

    Of course, whacking up tax on flights would make people holiday in the UK more…

  • Richard Dean 2nd Jul '14 - 2:56pm

    Would this be consistent with EU competition law?

  • Roger Knight 12th Jul '14 - 4:14pm

    As pensioners, my partner and I would welcome any reduction – it would mean that we could plan a holiday with a slightly less concern about what it is costing – and give us a little more spending money!

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