Jacques Borel has admitted that withdrawing alcohol from his fight to cut VAT may be a ‘realistic concession’.

The veteran campaigner, who is lobbying for a VAT cut from 20% to 5% for the hospitality sector, made the admission in an open letter to members of his VAT Club.

He also insisted that while Government remains ‘negative’ towards his lobbying efforts, the UK Independence Party is backing his campaign.

He warned supporters “we are very conscious about the political sensitivities of alcohol being included (in a VAT cut).

He added: “While we have not officially withdrawn alcohol from the demands we believe that a realistic concession might eventually be for beer and cider and table wine, when served with a meal, to attract the new reduced rate: we shall see what the Government says but in the meantime I would value your opinion.”

Borel said despite support from the MPs he had spoken to, the Government remained resistant to his pleas.

He said: “It is true and not unexpected that the government reaction has been negative but this is consistent with my experience lobbying in other countries where changes of heart become evident at the last minute.”

On UKIP he said: “I appreciate that UKIP does not (yet) have any MPs but I have met senior people there and that party has indicated support for the VAT campaign. Their views will increasingly be noted by the political parties, and especially by the Conservatives.”

In his letter Borel suggests that the next step in the campaign might be for businesses to adopt a ‘business pledge’ that allocates the value of reduced VAT: 60% returned to consumers by way of reduced prices; 20% allocated to investment in facilities and improvements in the building fabric - and thereby having a multiplier effect; 10% earmarked for payroll benefit; 5% invested in staff training and apprenticeships; 5% in retained profits and dividends.

Borel also asked members for their views on what direction the campaign should take next.