In a bold move to alleviate the mounting pressures faced by the hospitality industry, four prominent UK chefs have called on the government to reduce the Value Added Tax (VAT) for pubs and restaurants to 10%. This plea comes as they describe the current climate for hospitality as “the hardest it has ever been,” with many businesses struggling to remain afloat amidst rising costs and dwindling customer spending.
A Call for Change
Tom Kerridge, Yotam Ottolenghi, Ravneet Gill, and Simon Rogan voiced their concerns during a recent appearance on BBC Newsnight, highlighting the urgent need for tax reforms that reflect the realities faced by their sector. They argue that a VAT reduction would not only ease financial burdens but also align the UK more closely with neighbouring European countries, where hospitality tax rates are significantly lower.
Rogan, who oversees a restaurant group with nine Michelin stars, lamented the lack of profitability, stating, “We’re not making any money whatsoever, and we’re just keeping our heads above water.” Kerridge echoed this sentiment, critiquing the government’s tax policies and their detrimental effects on the industry.
The Burden of Taxation
The standard VAT rate in the UK stands at 20%, one of the highest in Europe, trailing only Denmark. Industry representatives, such as UK Hospitality, have long advocated for a reduction to bring rates in line with those in Germany (7%), Ireland (9%), and France, Italy, and Spain (all at 10%). The chefs argue that high taxation siphons off vital revenue that could otherwise be reinvested into their businesses and staff.
Yotam Ottolenghi, who operates a chain of 11 establishments, described the situation as “crippling.” He pointed out that a large portion of every pound earned is redirected to government taxes, leaving little for essential operations and improvements.
The Impact of Crisis on the Industry
The hospitality sector has faced relentless challenges over the past few years, from the pandemic-induced shutdowns to skyrocketing energy costs exacerbated by geopolitical tensions. As inflation bites into household budgets, consumers have curbed their spending on dining out, compounding the difficulties faced by restaurants and pubs.
While initiatives like the “Eat Out to Help Out” scheme provided some temporary relief during the pandemic, the current climate suggests a more permanent solution is necessary. According to UK Hospitality, three hospitality businesses are closing their doors every day since the start of 2026, signalling a critical need for support.
The Future of Employment in Hospitality
The implications of the chefs’ call extend beyond the financial health of businesses; they also touch on employment opportunities, particularly for young people. The hospitality sector is a significant employer of 18 to 20-year-olds, accounting for 28% of this age group, according to the Institute of Fiscal Studies. However, a recent report revealed that job prospects for young individuals are dwindling, with over one million not engaged in education, employment, or training.
Ravneet Gill, who opened her first restaurant just last year, stated she “never imagined it would be this tough,” particularly regarding the costs associated with hiring staff. The chefs argue that reducing VAT would enable businesses to create more jobs and offer better wages, ultimately benefiting the youth entering the workforce.
Why it Matters
The call for a VAT reduction is not merely about improving profit margins for restaurants; it is a plea to safeguard the future of the hospitality industry, which plays a vital role in community life and youth employment. As businesses struggle under the weight of high taxes and operational costs, the potential loss of jobs and culinary culture poses a significant risk to the fabric of society. By listening to these industry leaders and considering their recommendations, the government could foster a more resilient hospitality sector, ensuring it continues to thrive and contribute to the economy.
