Hospitality set for summer lift with VAT relief

Four in 10 families plan to go out more this summer due to the policy.

The government’s value-added tax (VAT) cut for family days out is set to boost the country’s hospitality sector as consumers plan to take advantage of the cost savings.

Four in 10 (41%) families plan to go out more this summer due to the temporary reduction in VAT for children’s activities and meals, according to RSM UK.

Amongst households earning £20,000 to £40,000, 44% said they intend to spend more on family outings.

That figure drops to 29% for those earning between £40,000 and £80,000, before climbing to more than half (52%) of households earning above £80,000.

“The success of the policy will depend on how much of the savings can realistically be passed on to consumers,” Saxon Moseley, head of leisure and hospitality at RSM UK, said.

He added that with the industry calling for the government to permanently cut VAT on hospitality, the temporary measure could be a good trial to demonstrate the wider impact reforms could have.