Could Tourism in the South West Suffer a Blow if VAT Isn’t Reduced?

5 June 2014, 20:37

VAT adds to the cost of any services or goods that are liable for it. As a consumer you’ll pay more if you buy something that is subjected to VAT.

So imagine the difference it could make if you bought something that had just 5% VAT included instead of 20%. It would make a big difference to the bottom line – and it could make a big difference to the West Country if those in the tourism industry get their wish.

There has long been a tug-o-war going on for holidaymakers. There is indecision regarding whether to choose an all-in holiday in a hot foreign country on the continent or whether to stay home and go to places such as the West Country instead. The almost guaranteed sun is a big tick in the right box for going abroad, but prices are another big issue worth considering, especially where many family budgets are squeezed.

This is where the Cut Tourism VAT campaign comes in. They believe that if the rate of VAT for tourism was cut it would bring the West Country in line with many other places in continental countries, some of whom pay 5%. The more tempting the West Country is, the more likely it is some people will choose to stay at home for their holidays instead of going abroad.

The tourism industry is big in the south west, bringing in millions of pounds and providing lots of jobs as well. Imagine how that situation might change for the better if more people saw it as a viable and affordable holiday destination each year.

The government has no plans at present to make any changes to the amount of VAT the industry pays. This looks to be a tense stand-off that is likely to continue for some time to come. There are MPs in the south west who wholeheartedly support the drive to bring down VAT but at present this enthusiasm has not translated into government corridors.

This summer will no doubt draw the crowds to the south west as it normally does, but many more will fly abroad for some sun, sand and cheap prices. Many believe Cornwall, Devon and Somerset could be a lot more competitive in this respect if prices were as cheap as they are in some other places on the continent. There are many ways in which people can be persuaded to take holidays in their own country, but surely the financial reasons are among the strongest of all?

Unless the desired change does come about we have some way to go yet before we can truly compete on level financial terms.