The Wonky Table

37 days until high street oblivion. Rachel Reeves is skyrocketing business rates, and her tax rises will hit businesses on April 1st. Thousands of cafés, pubs, restaurants, bars, shops, hotels will close forever, with countless job losses. We need a full U-turn now.

Radio presenter: "Is Keir Starmer still barred from your pub?" Clarkson: "Oh god yes. I hate very few people in life, but I do truly hate that man, he’s awful. So he’s definitely banned."

Unemployment will continue to worsen until we get a VAT cut for Hospitality. Everyone knows it makes sense. It’s do or die for the sector.

Do you mind if I try and explain why a VAT cut for hospitality makes sense? 1. Hospitality has a social function (creating vibrant and meaningful communities) which most countries aim to support through tax. There’s lots of things that payer VAT because of their perceived social and other benefit, I would argue hospitality is an example. 2. Because our business tax system has evolved to have a disproportionate property-based component, hospitality businesses pay a wildly disproportionate amount of tax compared to other sectors. VAT is a mechanism to redress that over-payment. 3. Hospitality has far higher than average spillover effects, with businesses directly creating value for those around them, for instance in higher property values or encouraging spend in other shops. A hospitality business may be creating huge value for others but quite lean profits for itself. Think about a really good village pub that makes the village come alive. VAT is a way of redressing some of that spillover or ‘leaked’ value. Does that make sense? Obviously there’s all the arguments about job creation for young people etc, but I think the economic structure argument itself is quite interesting.