Scottish tourism bosses have called for the “eat out to help out” scheme to be brought forward to help salvage the rest of the summer season.
From August restaurants and pubs that sell food can sign up for a Westminster-funded scheme that could cut customer bills in half.
Hospitality and tourism businesses across the UK will also see the amount they pay the government in VAT on goods and services chopped from 20% to 5%, a move widely welcomed by Scotland’s tourism bodies.
Aberdeenshire-based beer company Brewdog was one of the first to announce it would be passing the VAT cut on to customers.
We welcome the Chancellor's announcement today on the VAT reduction to 5% for hospitality.
We are going to pass on every single penny to our amazing customers. pic.twitter.com/LMq6Ivvg1w
— James Watt (@BrewDogJames) July 8, 2020
As many as 60,000 jobs have been furloughed in tourism hotspots like the Highlands and Islands alone, while hospitality and tourism across the UK makes up for around 8% of the country’s workforce.
Tourism bodies approve but want scheme brought forward
Marc Crothall, chief executive of the Scottish Tourism Alliance (STA), said the tax cut would come as “huge relief” for the country’s business owners, but pointed out Scotland’s holiday season is already under way.
As such, the STA called for the scheme to be brought forward, to allow Scottish companies to take full advantage.
He said: “The series of support measures announced by the chancellor are hugely welcomed by Scotland’s tourism industry and go beyond what we had anticipated in terms of the lowering of VAT to 5%.
“The STA, along with our counterparts at UK Hospitality have campaigned heavily for years for the UK Government to cut VAT to 5%.
“This represents a huge catalyst for the tourism economy and I know this news will come as a huge relief today for thousands of pubs, restaurants, accommodation providers and visitor attractions across Scotland and their employees, whose jobs have been given increased protection.
“The ‘kick start’ scheme to create more jobs for young people is a huge boost for the tourism sector, as indeed is the announcement of support for businesses taking on new apprentices, with the under 25s representing such a large proportion of our workforce; however, we will continue to push for support for all employed in the tourism sector.
“Further tailored support for older people within the sector is still required as the stark reality of the unemployment crisis looms large.
“Incentives for the public to support our hospitality industry was one of the recommendations the STA made to the Independent Advisory Group on Economic Recovery and I am pleased to see that this has been included in the raft of support measures announced today for the tourism sector.
“We must remember that while August marks the start of the school holidays south of the border, Scots are already planning staycations and days out throughout July so we will be pushing for the ‘eat out to help out’ initiative to be brought forward in alignment with the reopen date of Scotland’s tourism industry on July 15.”
Skye Connect, which represent businesses on the island, said the VAT reduction would allow companies to retain furloughed employees once the summer season finished.
A spokesperson: “The cut in VAT from 20% to 5% for the hospitality industry is great news as we prepare to open our businesses after lockdown.
“The UK has had the highest rate of VAT in Europe and this has always put our industry at a competitive disadvantage.
“Our tourism industry is facing the shortest season on record before we are once more into the long winter with minimal income.
“The VAT reduction will help us retain jobs once the furlough scheme ends. We also welcome the government’s ‘eat out to help out’ initiative and support the Scottish Tourism Alliance’s proposal for the scheme to be brought forward to July in Scotland so that families planning a staycation during the school holidays can take advantage of the government-backed discount.
“Investing in our sector during this sharp economic downturn is a bold and welcome move that will save many thousands of jobs.”
Pleas to get ferries up and running
Businesses in the Western Isles will not see the benefit of tax breaks or voucher plans unless the ferry service can bring people over the sea, a rural tourism body has claimed.
Outer Hebrides Tourism boss Rob McKinnon said hospitality businesses are ready and waiting for customers to descend on the islands, but are unclear still how they would arrive due to the limited ferry service.
“Any help like this from the government is of course good news, but from our perspective our particular concerns are about ferry services.
“It was announced at the start of the month the season would begin on July 15, but we still are to hear when and if boats will be running.
“Businesses won’t be able to take advantage of cuts to VAT if there is no money coming in — 20% and 5% of zero is still zero.
“We are hopeful an announcement will be made soon and people will be able to get over.”