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Fri 1st Jul 2022 - Update: Cut in VAT proposed, Comptoir Group re-appoints chairman after his re-election is voted down
No 10 proposes VAT cut to ease pain of rising prices: A cut in VAT has been proposed by No 10 to curb inflation and help households with the cost of living crisis. Steve Barclay, the prime minister’s chief of staff, suggested reducing the 20% headline rate of the tax, The Times has reported. He proposed that a temporary cut would reduce the tax bill for millions and ease inflation, which is at 9.1% – the highest for 40 years. However, the Treasury is concerned about the cost of the move and has warned that it could ultimately fuel inflation by overstimulating the economy. It has also raised the point that it would benefit wealthy households as well as poorer ones. Cutting VAT to 17.5% would cost the government about £18bn. The Times has been told that Barclay raised the idea of cutting the tax during discussions with the Treasury over the past fortnight. He suggested that it would be “de-inflationary”. A source familiar with the discussions said: “Steve’s been pushing it quite strongly but the Treasury is not buying it.” Another source said a potential VAT cut was discussed by Treasury officials last month before they decided against it. There were concerns that it could lead to a temporary fall in inflation followed by a longer, deeper recession. Paul Johnson, head of the Institute for Fiscal Studies, said cutting VAT would be “economically inappropriate”, adding: “It would reduce inflation in the short run because it would reduce prices relative to what they would have been. But it would increase inflation next year. It can’t help in the long run. And it could actually lead to higher inflation overall because you would be pumping extra money into an economy where demand is already outstripping supply. Stimulating demand at the moment would be economically inappropriate. On this one the Treasury is right.” Kate Nicholls, chief executive of UKHospitality, said: “Cutting VAT would be a significant and positive step.” Peter Borg-Neal, chairman of Oakman Group, said: “It would be a sign that the Treasury are getting a clear understanding of the problem and, consequently, have figured out a sensible measure to tackle it.”

Updated Premium Database of Multi-Site Companies released today at midday, 50 business being added: A total of 50 new multi-site companies, operating 323 sites, have been added to the next edition of the Propel Premium Database of Multi-Site Companies, which will be released today (Friday, 1 July), at midday. The updated Propel Multi-Site Database, which is produced in association with Virgate, includes growing experiential concepts, regional restaurant and pub operators and expanding hotel brands. Premium subscribers will also receive a 4,500-word report on the new additions to the database. The comprehensive database is updated monthly and provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different. It features more than 2,000 companies. Premium subscribers will also receive the next edition of the New Openings Database, which is produced in association with StarStock, on Friday, 8 July, at midday. It focuses on newly announced openings and upcoming launches in the sector and is updated every month. The next edition also includes a 19,000-word report on the new additions to the database. Premium subscribers also receive access to the Propel Turnover & Profits Blue Book, which is produced in association with Mapal Group. The Blue Book, which is also updated monthly, provides an insight into UK operator turnover and profitability over five years, profit conversion and directors’ earnings. Premium subscribers have also been given exclusive access to the UK Food and Beverage Franchisor Database, which is an exhaustive guide to the companies offering a food and beverage franchise in the UK and will be updated every two months. The second edition featured 120 companies, providing insight on the offer, locations, cost and other key details. The second edition provides almost 47,000 words of content. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The single subscription rate is £445 plus VAT for operators and £545 plus VAT for suppliers. Email to upgrade your subscription. Subscribers also receive access to Propel’s library of lockdown videos and Friday Wrap interviews and now also have access to a curated video library of the sector’s finest leaders and entrepreneurs, offering their insights on running outstanding businesses in the sector. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out; regular video content and regular exclusive columns from Propel group editor Mark Wingett. In this week’s Propel Premium, Sarah Weir, founder and managing director of Albion & East, the Imbiba-backed, London-based bar business, talks about creating a great drinks-focused business; David Roberts, head of leisure at CMS Mckenna UK, discusses how business can bridge the valuation delta; while Mark Wingett looks at this week’s people moves and the furore at Comptoir Group.

Board of Comptoir Group re-appoints chairman after co-founder votes down his re-election: The board of Comptoir Group, the Comptoir Libanais and Shawa brand operator, agreed to re-appoint the Richard Kleiner as chairman, after major shareholder and the company’s co-founder Tony Kitous voted down his re-election at the firm’s AGM. Earlier this week, Kitous called for the company’s chairman Kleiner and chief executive Chaker Hanna to resign. Kitous, who owns a 47.6% stake in the company, wrote to the board urging the pair to stand down. In the event that neither resigns, Kitous stated within the letter he would be voting against the re-election of the chairman at the annual general meeting on Thursday (30 June). Yesterday Comptoir announced that at its AGM, resolutions one, three and four were passed while resolutions two, five and six did not pass. As resolution two was not passed Kleiner was not re-elected as a director of the company. In a subsequent board meeting, the directors agreed to reappoint Kleiner in his role. The company said: “The directors in attendance at the board meeting took into account that 100% all shareholders who voted on resolution two, save for Mr Tony Kitous, voted in favour of the re-election of Mr Kleiner. Further, the directors in attendance also considered the need for an independent non-executive director in order to maintain a well-functioning, balanced management team led by a chair.”

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