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Thu 20th Jun 2013 - Forty sector operators launch Tax Parity Day
Forty pub and restaurant firms launch tax parity day: Forty high profile pub, restaurant and foodservice companies are aiming to reduce the level of VAT in the hospitality sector from 20% to 5% by launching a national day of action. The VAT Club JB, headed by veteran VAT campaigner Jacques Borel, is organising a Tax Parity Day across the UK on Wednesday 25 September. The action is the biggest ever piece of consumer-facing campaigning ever organised by the industry. The campaign is calling on tens of thousands of fellow publicans, restaurateurs and foodservice operators to reduce their prices by 7.5% for one day only, in order to highlight the benefits of a VAT reduction to 5%. And it is backing the campaign with 250,000 posters, which will be distributed to venues in order to highlight the national day of action to their customers. It is being backed by members of The VAT Club JB. These include pub operators JD Wetherspoon, Brains, Heineken, Shepherd Neame and Punch Taverns, family brewers including Fuller’s, Charles Wells and St Austell, restaurant group Pizza Hut, hotel operator Mandarin Oriental, sandwich chain Subway and motorway services operator Roadchef. Jacques Borel has campaigned effectively for the level of VAT in the hospitality sector to be reduced in a large number of European countries. He said: “Our aim is to secure a more equal tax treatment for food sold through pubs, restaurants and food service operators, compared to supermarkets, which benefit from a zero VAT rate. We are calling on supporters of the campaign to reduce their prices by 7.5% for one day. This is the amount by which we believe that prices would fall if VAT were cut to 5%, on the assumption that 60% of any reduction would be passed onto the customer in lower prices. So, for example, the total price of a meal and drinks for a family of four would be reduced from £60 to £54.60 on Tax Parity Day.” Mr Borel argues that a 7.5% reduction on the day will lead to increased turnover of between 10 and 12% for operators taking part, as they will attract more customers to their outlets. In France, a similar campaign saw sales increase by 8% on the day of action. Mr Borel added: “Our argument is clear – a reduction in the level of VAT on a long-term basis will generate growth and create jobs in the important leisure and hospitality sector.” JD Wetherspoon chairman Tim Martin said: “Wetherspoon wholeheartedly supports Jacques’ initiative for Tax Parity Day. We’re aiming to make it our busiest day of the entire year. Creating tax parity between pubs, restaurants and supermarkets will fulfil many government objectives. It will create more jobs and it will raise the amount of taxes the government receive, since pubs and restaurants pay more taxes and create more jobs than supermarkets. It’s a win-win situation for the government, voters and our industry.” Pizza Hut UK chief executive Jens Hofma said: “We are strong supporters of Tax Parity. It will create a fairer competitive environment and contribute to the growth of a vibrant going-out environment. Most importantly, tax parity will also fuel the creation of jobs, which are broadly accessible and offer huge opportunity for personal and career development in a truly meritocratic sector.” Jacques Borel, Tim Martin and Jens Hofma will be talking about the campaign at today’s Propel Multi Club Conference. 
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