The Brexit referendum vote could lead to a cut in the rate of VAT levied on tourism, a senior cabinet minister has said.
Speaking at a British Hospitality Association (BHA) Hospitality and Tourism summit in London, John Whittingdale, secretary of state for culture, media and sport, said the UK could now ‘abolish VAT on accommodation or attractions’.
“We couldn’t have done when we were in the European Union,” he added.
His remarks were welcomed by Nick Varney, chairman of the BHA and chief executive of Merlin Entertainments who was optimistic about the future of the sector.
“Tourism and leisure can continue to grow under Brexit,” he said. “Initially a weaker pound will encourage visitors and also exports will flourish. We should seize the moment and lock in that competitive advantage with a permanent cut to VAT for accommodation and attractions, and possibly in the future also for restaurants.”
Tourism and hospitality accounts for 9% of the UK’s GDP.
The industry employs 10% of the UK’s workforce and has created 1 in 5 new jobs over the past five years.