Discounts and VAT reductions were revealed in Chancellor’s latest financial statement
A new scheme to encourage people to visit restaurants after the recent lockdown has been announced by the Chancellor Rishi Sunak.
As well as offering discounts for people dining out, he also outlined other ideas to help boost the economy including a bonus for companies who keep on furloughed staff, a pause in stamp duty for under £500k and VAT reductions for hospitality businesses.
The measures announced today are extremely positive and they should give many businesses in our sector much-needed help to get going again in earnest
In his post-Covid lockdown financial statement, Mr Sunak promised that every person in the country would be eligible for a 50 per cent discount off meals eaten out during August 2020. This new incentive has been designed to help boost midweek trade and the so-called ‘eat out to help out’ discount will be available between Monday-Wednesday on meals up to a value of £10. Alcoholic beverages are not covered by the scheme, which also does not apply to take-away food.
The Chancellor announced the launch of a new website next Monday, through which restaurants, cafés, or other food operators can register to take part in the scheme. “Each week in August, businesses can then claim the money back, with the funds in their bank account within five working days," he promised.
Almost all restaurants, many of which reopened last weekend, have had to cut capacity in order to comply with social distancing measures. A significant percentage of tables have been removed making sure that customers stay at least one meter away from each other.
Many restaurateurs were overjoyed at hearing the latest developments, although there is a long way to go to restore people’s confidence in regard to dining out.
VAT will be reduced from 20 per cent to five per cent from next week until 31 January 2021 to further boost the struggling hospitality industry.
Peter Kinsella from Lunya, was invited to speak on BBC News after calling for a 5% VAT cut. After the announcement, Lunya tweeted ‘5% at least, targeted at hospitality, tourism & leisure (10% hopefully), plus debt enforcement moratorium and flexible furlough whilst restrictions in place. If we get this, we’ll pay £10M in taxes back over next 10 years. Win/win’
Peter announced last month that the Manchester branch of Lunya would not be reopening after lockdown was lifted die to the impact of Covid-19.
UK Hospitality, the organisation representing everything from bars, coffee shops, contract catering, hotels, nightclubs, visitor attractions and other leisure venues, who have been campaigning vociferously throughout lockdown for the survival of the hospitality sector, tweeted; ‘The measures announced today are extremely positive and they should give many businesses in our sector much-needed help to get going again in earnest.’
Some cynics on Twitter suggested that this was in fact a governments sponsored scheme to spread coronavirus but, during his financial statement, Sunak encouraged consumers to find “that new balance between safety and normality”.