Why Hospitality Needs a Fighting Chance — And Why VAT Matters
Recently, there’s been a lot of conversation around the pressures facing hospitality — and I felt it was important to add my voice.
Like Tom Kerridge, I believe the UK hospitality sector urgently needs meaningful support — and one of the most impactful changes would be a reduction in VAT.
Running a multi-site business across hotels, restaurants, and wellness, we’re seeing first-hand just how challenging the current environment has become.
The Reality Behind the Numbers
Across The Vibe Collection — including The Suffolk Hotel, Tiger Fusion and The Gainsborough Spa & Health Club — the pressure isn’t coming from one place.
It’s coming from everywhere at once.
- Rising wage costs
- Increasing business rates
- Higher energy bills
- And significant increases in National Insurance
In fact, our National Insurance bill alone rose by around 30% last year. That’s not a small adjustment — it’s a serious financial shift that impacts how every part of the business operates.
And when all of these pressures hit at the same time, it becomes incredibly difficult to absorb.
Why VAT Is Such a Big Lever
VAT isn’t the only issue — but it’s one of the few levers that could make an immediate, meaningful difference.
Other countries have already recognised this.
Germany reduced VAT for restaurants to 7%, and across Europe, many countries sit closer to 12%. That’s a level that allows businesses to breathe, reinvest, and stay competitive.
Right now, the UK is asking its hospitality sector to operate at a disadvantage.
A reduction to around 12% wouldn’t fix everything overnight — but it would give operators a fighting chance.
The Pressure at Site Level
From a day-to-day perspective, the pressure is relentless.
Across our hotel and spa operations in particular, we’re balancing:
- Higher staffing costs
- Rising energy usage
- Increasing customer expectations
- Tightening margins
There’s only so much you can absorb before it starts to affect real decisions — pricing, investment, hiring, and ultimately growth.
That’s the reality many operators are facing right now.
The Bigger Picture: Jobs, Growth & Communities
Hospitality isn’t just about food, drinks, or rooms.
It’s one of the UK’s most important employment sectors.
It creates opportunities quickly.
It builds skills.
It offers long-term careers.
And beyond that — it sits at the heart of our communities.
The pub, the restaurant, the local hotel — they bring people together. They create energy in towns like ours. They support local suppliers and local jobs.
But right now, too many businesses are simply trying to keep their heads above water.
A Call for Practical Support
This isn’t about asking for a handout.
It’s about creating a fair environment where hospitality businesses can operate, grow, and continue contributing to the economy.
A reduction in VAT would:
- Help protect jobs
- Support reinvestment
- Encourage growth
- Strengthen local economies
Most importantly, it would give businesses the breathing space they need to move from survival mode back into growth mode.
Final Thoughts
Hospitality is resilient — it always has been.
But resilience alone isn’t enough when cost pressures continue to rise across every part of the business.
If the Government is serious about supporting employment, growth, and local communities, then hospitality needs to be part of that conversation.
A VAT adjustment won’t solve everything.
But it could be the difference between standing still… and moving forward.
