Businesses across Dundee have welcomed the chancellor’s announcement to cut VAT in the hospitality industry to just 5% for the next six months.
At his summer statement yesterday, Chancellor Rishi Sunak announced VAT would be cut from 20% to 5% in the hospitality and leisure sector until next January, including pubs, restaurants, cafes and cinemas.
It is hoped the move, which will cost the UK Treasury £4 billion, will encourage more people to go out and spend their money in local hospitality businesses.
And many businesses in Dundee think this is a step in the right direction.
Jeanette French, owner of Strathdon Guest House in the West End, said: “I think it is a really good idea because businesses are really struggling at the moment.
“I know at the start of the lockdown I got no sleep at all because I was worrying about everything.
“I do think the chancellor has been really good at trying to help people out during this worrying time.
“Everyone is in the same boat – when you go down the town the streets are deserted because people are scared to go out and spend their money.
“And people from abroad won’t be coming to Dundee either.
“I love the hospitality trade, I have been in it for over 40 years, and cutting the VAT rate is brilliant.
“It will help a lot of troubled businesses, so I’m sure lots of people will be very grateful for this.”
Meanwhile Debbie Findlay from The Eagle Coaching Inn in Broughty Ferry said: “Anything like this would be welcome because for many of us we don’t know what is going to happen over the next few months.”
Alison Henderson, chief executive of Dundee and Angus Chamber of Commerce, said she hopes the move will not only boost the hospitality industry but will help to retain some much-needed jobs in the area as well.
She said: “This sector needs some additional support, and I fully understand it is difficult across the board but the hospitality and tourism industry absolutely needs our support.
“The government needs to do something and consumers need to get out there and spend their money, so this is very much to be welcomed.
“Hopefully over the next six months people will come to visit Dundee for ‘staycations’ and many businesses will now be able to breathe a massive sigh of relief that VAT has dropped that much.”
The VAT cuts in the hospitality industry will come into effect on Wednesday and will run right through until January 12, 2021 but will not apply to alcohol sales in pubs and restaurants.