JD Wetherspoon’s chair has called on ministers to slash VAT for pubs and make the taxes “fair and equitable” between retail and hospitality.
The budget pub chain is to cut the price of food and drink in its venues by 7.5 per cent on Thursday this week, in a call for a return to the pandemic 12.5 per cent level.
VAT for hospitality venues was reduced to five per cent during the pandemic and gradually increased back to its normal rate.
The rate was lifted from 12.5 per cent to 20 per cent in April, despite industry chiefs calling for a longer reduction to help businesses as they recovered from the side effects of Covid lockdowns..
Tim Martin’s estate of 851 pubs will see prices reduced on so-called ‘Tax Equality Day’.
The pub boss said it was not fair supermarkets could use savings from zero VAT charges to sell alcohol to shoppers at cheaper prices.
“It doesn’t make sense for the hospitality industry to subsidise supermarkets,” he added.
“Pubs have been under fantastic pressure for decades due to the tax disadvantages that they have with supermarkets.”
The Chancellor should consider that the “main impact of tax equality” was on high streets and city centres, Martin said.
Local economies “heavily depend on a diversity of prosperous hospitality businesses for economic, social and employment success,” he said.
it comes as pub chiefs have called for more support to help the industry weather increases in energy bills and pressure on consumer spending.