Chancellor extends VAT cut for hospitality sector

The reduced 5% VAT rate for the hospitality industry was due to apply for the period between 15 July 2020 and 12 January 2021. This period has now been extended to 31 March 2021.

This is good news for the hospitality industry, especially as the winter months will have the dual challenge of both Covid-19 restrictions and higher overheads for many businesses (electricity and gas etc) coupled with lower sales.

Just to recap, the 5% rate applies to the following main supplies: