Bristol hoteliers back celebrity chef’s call for VAT cut
Bristol’s hoteliers are backing a call by celebrity chef Tom Kerridge for a 10 per cent VAT rate to be applied to hospitality businesses.
The campaign, supported by leading trade body UKHospitality, the British Beer and Pub Association, the British Institute of Innkeeping and CODE Hospitality, saw more than 100,000 signatures added to a petition in less than 72 hours.
Adam Flint, chairman of the Bristol Hoteliers Association, says occupancy has been quite strong in the city’s hotels so far this year, growing by three percent compared to last year but warned this is at the cost of ADR (Average Daily Rate), which has only seen marginal growth.
And with costs continuing to rise, he warned that while occupancy has grown, profits are, at best, the same if not down, year-on-year.
He said: “The diluted ADR (the metric used in the hospitality industry to measure the average revenue earned for an occupied room per day), added costs and tariffs from suppliers as a knock-on effect of the war in the Middle East, minimum wage, and food & beverage inflation have all had an impact.
“While total revenue growth across the city is between three and six percent, the additional costs of operating are between three and 13 per cent, which is putting a strain on hotels.
“Trading is sluggish in terms of meetings and events, with a notable decline in larger conference business and while there seems to be an upward shift towards smaller meetings, it’s not enough to mitigate the loss of the smaller ones.
“General food & beverage revenues are flat or, in some cases, slightly back as consumers tighten their belts and the price of goods continue to climb, which is why the need for a reduction in VAT is widely supported among the BHA group.
“While we cannot control rising costs in a lot of areas, one thing for sure is a reduction in VAT will encourage consumer sales and bring prices down to a more reasonable level, as many other countries in Europe operate with right now.
“The hospitality sector relies on sales growth to maintain job numbers and profit margins, so for the BHA, it’s a no-brainer to support the #VATsTheProblem campaign.”
However, while hotels are still facing challenging times, he said there are lots of reasons to believe the summer could be just a bit brighter for their businesses.
Adam added: “June has started well, and we welcome international cricket to the city which will certainly help boost the local economy, as we saw with the rugby last September.
“Looking towards July and the run-up to summer, general occupancy is looking quite healthy, albeit at the loss of ADR once again.
“We’ve got Bristol Pride, the Harbour Festival, graduation ceremonies and the Balloon Fiesta, as well as many more smaller music events, all of which will hopefully provide a decent base for local hotels and the economy, so there is still cause for optimism – but it would be a lot better if we can get that helping hand from a reduction in VAT.”
Image by Guo Fengrui at Pexels
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