Skip to content
Search
AI Powered
Latest Stories

Temporary VAT Cuts on restaurants, bars and hospitality comes into effect

A cut in the rate of VAT on restaurants, bars and hospitality from 20% to 5% has come into force of today (15th July).

The temporary reduction will be in place until 12th January 2021 in a bid to get the UK economy kickstarted following months of lockdown due to coronavirus.


Costa Coffee, McDonalds, Pizza Express and Nando's are just some of the many major companies that have announced price reductions.

The move was announced by Chancellor of the Exchequer Rishi Sunak as part of the Summer Statement last week, as part of the effort to support businesses impacted by forced closures and social distancing measures.

The Treasury estimates households could save £160 a year on average, but not all firms will pass on the benefit.

An “Eat Out to Help Out” scheme was also announced by Mr Sunak, where customers who dine at eateries supporting the campaign between Mondays and Wednesdays will receive £10 per head off their meals throughout August.

VAT, or Value Added Tax, is paid on everyday goods and services, but the tax is usually included in the price most consumers see.

Some items however, do not require customers to pay VAT, newspapers and magazines, children's clothing and most supermarket foods.

Nando's said it would reduce the price of it’s quarter chicken by 55p and pass on "100% of the benefits" from the tax cut to its customers.

McDonald's also announced price reductions on several popular menu items, including the Big Mac, the Quarter Pounder and coffee.

Last week, the Association of Convenience Stores (ACS) received clarification that any vendor providing food and drink for consumption on the premises, or hot takeaway food or drinks are eligible for the reduced rate, including local shops.

Cold takeaway food and drinks are not included in the reduced rate.

ACS chief executive James Lowman said: “Local shops have done a fantastic job ensuring that they have been able to continue feeding their communities safely and effectively.

“We welcome clarification from the Treasury that convenience stores and other small shops will be able to benefit from the reduced rate of VAT on specific food and drink sales.”

Figures from the 2019 Local Shop Report show that almost one in four convenience stores have some form of hot food counter or cabinet (23%) with around one in six (15%) currently providing either indoor or outdoor seating for customers.

Guidance on the temporary reduced VAT rate can be found here.

More for you

Nick’s experience will drive growth for our Manchester depot and Northwest customers

Nick Edwards

New manager for Hancocks in Manchester

Confectionery wholesaler Hancocks has a new manager at its Manchester store.

Nick Edwards has taken over at the helm of the store in Gorton, overseeingten staff and working closely with existing and new customers.

Keep ReadingShow less
Rachel Reeves delivers Spring Statement 2025 as retail costs rise with no relief
Photo by Ian Forsyth/Getty Images

Spring Statement fails to address independent retailers' concern

Costs are set to continue rising amid a difficult economic outlook following the Chancellor Rachel Reeves’ Spring Statement, which brought no significant change to major tax plans announced in the October budget despite urgent calls for support.

The Spring Statement released today (26) made no specific provisions for the independent retail sector, which is facing unprecedented challenges including rising business rates, an increase in employer national insurance contributions to 15 per cent above £5,000 per annum and an above-inflation increase in the minimum wage to £12.21.

Keep ReadingShow less
Dubai style chocolate bar with pistachio and knafeh, popular in UK supermarkets

Dubai style chocolate bar featuring a blend of pistachio and knafeh

iStock image

Dubai style chocolate takes UK by storm

Dubai style chocolate has taken the UK by storm with many shops stocking dupes of the popular flavour while some supermarkets are forced to impose limits on how much a shopper can buy at once.

Shoppers have been clearing the shelves of the chocolate bar which is filled with pistachio and the Arab dessert Knafeh - a shredded crispy pastry.

Keep ReadingShow less
Government tax increases on retailers impacting local businesses

Chancellor Rachel Reeves leaves 11 Downing Street to deliver her spring statement to Parliament on March 26, 2025 in London.

Photo by Peter Nicholls/Getty Images

Spring Statement: Reeves severely criticised for ignoring retail

Representatives of UK's convenience sector as well as those of independent retailers have heavily criticised Chancellor Rachel Reeves for ignoring the pleas of retail in her Spring Statement, thus pushing some local store operators towards closure.

Delivering the Spring Statement today (26), Reeves did not budge in reduction in business rate relief, National Insurance hike and in minimum wages.

Keep ReadingShow less
VApril 2025 UKVIA campaign poster promoting vaping as a quit-smoking tool
Photo: iStock

Vape awareness campaign to begin amid record-high misperceptions

VApril, the largest and most successful vape awareness campaign in the world, is returning for its eighth year amid record-high misperceptions around vaping and stop smoking tool.

Created by the UK Vaping Industry Association (UKVIA), the initiative comes at a critical time for the UK vaping sector, with half of smokers wrongly believing vaping is as harmful - or worse - than smoking.

Keep ReadingShow less