VAT cut for pubs and restaurants will save jobs, landlords say

Chancellor Rishi Sunak revealed in Wednesday's Budget that the VAT charged on food and drink in the hospitality sector would remain at the discounted 5% until the end of September.

Chancellor Rishi Sunak announced the extension as part of Wednesday's Budget (Image: PA Wire/PA Images)

It will then be charged at 12.5% for six months before reverting to the usual 20% rate.

Suffolk landlords have welcomed the extension - but some have called for the relief to be kept for longer as venues remain closed under coronavirus lockdown restrictions.

Restaurants and pub gardens will be allowed to serve customers sitting outdoors from April 12 before indoor diners and drinkers can be welcomed from May 17.

Brendan Padfield, owner of The Unruly Pig near Woodbridge, said: "It's a bit disappointing that this extension is not until the end of the year, but I don't want to sound ungrateful.

"This VAT relief will make the biggest difference in the world.

"Of all the steps taken, VAT will make the biggest difference to hospitality - it will save jobs."

Dan Lightfoot, landlord of The Greyhound pub in Ipswich, welcomed the move but said he was keen to reopen so his business could benefit from the relief.

Greyhound landlord Dan Lightfoot welcomed the tax break

He said: "It will be a great help. It will get us started on the long road to recovery.

"It will save jobs, but it's not much help while we can't open.

"We've got to pay for coronavirus eventually, and this seems a sensible way to do it."

Tina Leamon, who manages The Grill at Twenty5 in Ipswich with her son James, said it was likely her restaurant would be only be back to full capacity at the end of the year - when the rate would be higher.

Tina Leamon, who runs Ipswich's Twenty5 restaurant with her son James (Image: Archant)

She said: "It helps a lot. We're not going to look a gift horse in the mouth. But if it was extended until the end of the financial year that would be much better.

"The cut is going to make a difference, but not the difference they think it's going to make.

"By the time we are back open as normal again, we are going to be paying 12.5%."

Geoff Page, landlord of Bury St Edmunds' The Nutshell, one of Britain's smallest pubs, said: "At some point we're going to have to accept that support is going to be tapered away.

Geoff Page, landlord of The Nutshell in Bury St Edmunds (Image: Mariam Ghaemi)

"In this interim period, the cut is very welcome - but all good things come to an end.

"It would have been nice to have the 5% rate for the next year, but we're grateful for everything."