The SNP has challenged the Chancellor to maintain the reduced VAT rate for struggling hospitality and tourism businesses right through next year at the very least.

The call comes as the UK government is set to increase the VAT rate to the pre-pandemic level of 20% – up from the temporary 12.5% it is currently at.

The SNP’s Alison Thewliss has warned that businesses are already facing a tough winter due to rising fuel, staffing and supply costs, and the move to increase the VAT rate could push many over the brink.

Commenting, the SNP’s Shadow Chancellor Alison Thewliss MP said:

“Tourism and hospitality businesses are facing a tough winter – with rising fuel, staffing and supply costs.

“The Covid pandemic has dealt a heavy blow to many in the industry, pushing them into financial hardship and debt. It is critical that the UK government takes the necessary steps to protect businesses at this time – and not prematurely pull support from under their feet.

“Maintaining the 12.5% VAT rate right through next year – not putting it up to 20% – would bring much needed financial breathing space and relief for our hospitality and tourism businesses.

“The reality is that the measures announced in the Budget fell well short of the support needed to help our hard-hit businesses navigate through this turbulent period. The Chancellor must do the right thing and maintain the 12.5% VAT rate right through next year at the very minimum.”

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