Butlin’s boss calls for VAT cut during school holidays
THE boss of Bourne Leisure has called on Ministers to reduce VAT for the tourism industry during school holidays to test the effect of a tax cut.
Dermot King, whose company owns the three Butlin’s seaside resorts, Warner Leisure Hotels and Haven holiday parks, said Britain’s hospitality industry couldn’t compete with foreign destinations due to the tax burden, adding: ‘If you stay at a hotel in Clacton you are charged VAT at 20 per cent for the privilege. But in a Barcelona hotel you’re charged just 10 per cent.’
The £127billion-a-year tourism sector is Britain’s fourth largest industry and employs 10 per cent of the UK workforce.
King said: ‘If you want to rebalance the economy then tourism is the easiest industry to grow. It can create jobs fast, especially for young people, and that growth wouldn’t be sucked out of another part of the economy. You are persuading more British families to stay at home and more overseas families to holiday here.’
He said of a zero rate of VAT for the hospitality industry: ‘It would create 100,000 jobs and give a return in just three years. For those reasons I urge the Government to think about its tax strategy.’
King admitted that so far Ministers had been reluctant to cut VAT, but said: ‘If the Government finds a full VAT cut too expensive, one thing it could do to test whether it works is to reduce VAT for school holidays.
‘That would be a great message for families and it could measure the effect. People would see the difference. We’d cut our prices that day.’