Rachel Reeves<\/a>, the chancellor, announced a temporary reduction in VAT on the children\u2019s menu in restaurants from 20% to 5% between June and September, in order to help families with the cost of living crisis and offer a boost to the hospitality sector.<\/p>\nIt is part of a package including free bus journeys for under-16s in England in August and cuts to import taxes on some basic foods under a \u201cGreat British summer savings\u201d campaign.<\/p>\n
But there are questions over how much of the savings will be passed on to consumers, with many restaurateurs claiming children\u2019s food is often already sold at a loss.<\/p>\n
Will Murray, the owner of London restaurant Fallow, serves up a children\u2019s menu featuring pizza, cheeseburgers and grilled fish from between \u00a35 and \u00a310. \u201cIt\u2019s such a small soundbite that won\u2019t make any difference,\u201d he said. \u201cMost kids\u2019 food is already discounted at the cost of the restaurant anyway: the VAT cut wouldn\u2019t even make up that shortfall.\u201d<\/p>\n
Murray said there were many other measures the government could take to reduce costs for families and restaurants. \u201cChildcare costs is the main thing they could help with \u2013 and 5% on food doesn\u2019t help families or restaurants in any meaningful way at all.\u201d<\/p>\n
But Tim Martin, the founder and chair of the Wetherspoons pub chain, does now plan to cut the cost of the kids\u2019 menu throughout summer. The chain serves children\u2019s food including chicken nuggets and sausage and mash from \u00a34.99 to \u00a35.75.<\/p>\n
\u201cWe will reduce prices for children\u2019s meals during this time and it will be appreciated by parents and families,\u201d he said.<\/p>\n
The hospitality sector has long called for VAT rates on food and drink to be cut in line with other European countries. VAT, a consumption tax added to most goods and services, is at 20% for restaurants in the UK \u2013 one of the highest rates in Europe. The European average for restaurants is about 12%. In Italy, for example, this is set at 10% for food sold in restaurants.<\/p>\n
Martin said: \u201cWe would like the government to consider VAT equality with supermarkets, which will mean a permanent VAT reduction \u2013 a point that we have made many times, of course.\u201d<\/p>\n
Restaurateur Daniel Crump, who owns the Greyhound and the Old Town Bistro in Beaconsfield, serves children\u2019s meals for between \u00a35 and \u00a310. He said the new measure on children\u2019s food was merely \u201csymbolic\u201d.<\/p>\n
\u201cIt would be good for the government to go further to bring the UK in line with rates in Europe,\u201d he said.<\/p>\n
\u201cRestaurants are continuing to deal with rising food, energy and staffing costs, and many across hospitality have been calling for a broader VAT reduction that would deliver more meaningful, long-term support across the sector.\u201d<\/p>\n
UKHospitality, the lobbying group for the industry, said it was likely that restaurants would cut costs on the menu for children after direction from government but that it was \u201cup to individual operators\u201d.<\/p>\n
Kate Nicholls, the group\u2019s chair, said: \u201cThis should now be viewed by government as a downpayment on a wider shift to a lower VAT rate for the entire hospitality sector, to bring us in line with Europe. Our biggest competitors benefit from VAT rates that average about 10%, and can be as low as 7%, and the UK is a clear outlier.<\/p>\n
\u201cAs the government has recognised today, VAT is the single biggest lever it can pull to lower prices, tackle inflation, drive demand, boost spending, generate growth and create new jobs. I would urge it to be bold and cut VAT for the entire hospitality sector.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Cutting tax on children\u2019s meals is a political \u201csoundbite\u201d that will make little difference to families or businesses,…\n","protected":false},"author":2,"featured_media":599698,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[59,57,58,50,56,54,55],"class_list":["post-599697","post","type-post","status-publish","format-standard","has-post-thumbnail","category-united-kingdom","tag-gb","tag-great-britain","tag-greatbritain","tag-news","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/599697","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=599697"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/599697\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/599698"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=599697"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=599697"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=599697"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}