Pub giant JD Wetherspoon has said it will have to increase prices of meals by 50p later this month because of a VAT increase.
Prices of meals at the pub group will go up on Wednesday September 29, ahead of VAT rising to 12.5 per cent on Friday October 1.
The group will slash the price of all food and drink in its pubs by 7.5 per cent on Thursday September 23, to call for a permanent cut.
Customers will be able to order at “lower than normal” prices at the company’s 862 sites on so-called tax equality day.
The pub operator wants to highlight the potential benefits of a permanent continuation of the current reduced VAT rate of five per cent for hospitality.
The Treasury is gradually returning the tax so it is 20 per cent next year.
The pub group’s call comes alongside those of the wider industry, with trade body UKHospitality calling on businesses to lobby their MPs for a cut.
Wetherspoon chairman, Tim Martin, said it was unfair supermarkets pay zero VAT on food while pubs and restaurants were usually expected to pay 20 per cent.
“We urge the Chancellor to create tax equality between pubs and supermarkets by making the current VAT regime for pubs permanent.
“He should note that the main impact of tax inequality is on high streets and town and city centres, which heavily depend on a diversity of prosperous hospitality businesses for economic, social and employment success.”
Hospitality bosses have said the reduction would be a lifeline for businesses struggling with Covid debt and difficult trading conditions including supply chain disruption.
After Chancellor Rishi Sunak announced the reduction in July 2020, JD Wetherspoon said it would “fully pass on the tax benefit to its customers.”
It slashed the prices of beer alongside food prices including breakfasts, pizzas and burgers.