VAT gradually returning to normal rates

Since July 2020, there has been a reduced rate of VAT (5%, and not the normal 20%) charged on transactions in the leisure and hospitality sectors (which includes theatres and live events – a list of who it applies to can be seen here).

Plans earlier this year to return to the full rate were successfully challenged and a six month extension was obtained in the 2021 budget (along with a package of other measures) with the not-unreasonable argument that the sector was still substantially handcuffed by the coronavirus restrictions and a reluctance among customers to return.

The 5% rate ended on September 30th – up to 12.5% before returning to the full 20% next March.

With the end of furlough, the Universal Credit rises, inflation, and Brexit-related labour shortages, it’s shaping up to be a defining few months for our sector and for the economy.

This entry was posted in Economics, Employment, EU & Brexit, Inflation, Theatre and Live Events data, VAT and tagged , . Bookmark the permalink.

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