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The temporary VAT rate of 5% for the tourism and hospitality markets that has been in place since last summer will end on 30 September 2021 and a new rate of 12.5% will come into effect on 1 October.
In a bid to reduce the impact of the pandemic on the hard-hit hospitality, hotel and attractions sectors, a reduced VAT rate of 5% was introduced on 15 July 2020. To further assist severely affected businesses, this rate was extended until 31 March this year and then a further extension, to 30 September was put in place.
The supplies that will benefit from this on-going reduction are:
- food and non-alcoholic beverages sold for on-premises consumption, e.g., in restaurants, cafes and pubs
- hot takeaway food and hot takeaway non-alcoholic beverages
- sleeping accommodation in hotels or similar establishments, holiday accommodation, pitch fees for caravans and tents, and associated facilities
- admissions to the following attractions that are not already eligible for the cultural VAT exemption such as:
- theatres
- circuses
- fairs
- amusement parks
- concerts
- museums
- zoos
- cinemas
- exhibitions
- similar cultural events and facilities
The VAT rate will return to the normal level of 20% on 1 April 2022.
Further information issues relating to the temporary reduced rate can be found here.
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