Wetherspoon, the popular pub chain, is implementing a 7.5% reduction in food and drink prices today to underscore the impact of taxes on their operations. This initiative, labeled “tax equality day” by Wetherspoons, aims to emphasize the necessity of a permanent VAT cut for the struggling hospitality sector.
The goal of tax equality day is to demonstrate to customers the disparity in tax levies on alcohol and food between pubs and supermarkets. During this event, patrons at Wetherspoon’s outlets on September 18 will enjoy savings of 75p for every £10 spent. While pubs apply a 20% VAT on their food and beverages, supermarkets are exempt from VAT on food items.
Wetherspoons has pointed out that supermarkets leverage this VAT exemption to offer discounted alcohol prices to consumers. To alleviate the financial strain on the hospitality industry, VAT rates for this sector were temporarily reduced during the pandemic, starting at 5% in July 2020 and gradually increasing to 12.5% between October 2021 and March 2022.
Tim Martin, the founder and chairman of Wetherspoon’s, highlighted the significant tax disparity faced by pubs and restaurants compared to supermarkets. He emphasized the need for a VAT cut to 12.5% to enable pubs and restaurants to flourish, invest, and create job opportunities.
Notably, key industry organizations including UKHospitality, British Beer and Pub Association, and Campaign for Real Ale (CAMRA) have expressed support for Mr. Martin’s discounted pricing initiative at Wetherspoon’s pubs on September 18.