Tom Kerridge says ‘hospitality isn’t employing right now’ and urges next PM to slash VAT
Restaurant operators, tavern owners and cafe owners called on the new Prime Minister to reduce VAT to prevent further venue closures and a decrease in employment for young people.
One in six businesses is at risk of closing in the next 12 weeks, according to new research by the British Institute of Innkeeping, UKHospitality, British Beer and Pub Association and HospitalityUlster.
Tom Kerridge, a familiar face on cooking shows such as Saturday Kitchen and Bake Off, has called on the public to pressure politicians to cut VAT.
He led calls from small business owners to cut the tax from 20 percent to 10 percent to help them avoid business closures, job losses and price cuts.
It is understood that Ireland will reduce the VAT rate on accommodation from 13.5 percent to 9 percent tomorrow (Wednesday, July 1).
Accommodation operators say they are struggling to make ends meet due to high costs such as energy, wages, National Insurance contributions, food, beer duty and business rates.
Tom Kerridge says hospitality employers want to help with rising youth unemployment but are having difficulty recruiting.
Experts say it would help if the UK’s VAT rate was brought into line with the rates paid by businesses in the rest of Europe.
Kerridge, whose site The Hand & Flowers was the first gastropub in the UK to be awarded two Michelin stars, said hospitality employers wanted to help with rising youth unemployment but were struggling to recruit.
Kerridge said: ‘Hospitality is not working at the moment, it is stagnating, going backwards, closing down. ‘These jobs do not exist and are not currently accessible to young adults.’
The chef hopes venues across the country will start putting up posters to raise awareness of UKHospitality’s ‘VAT is the problem’ campaign to encourage customers to sign a petition.
He said he was optimistic that Andy Burnham, who has launched his bid to replace Keir Starmer as Prime Minister, would support the idea of a VAT cut.
“We hope he will understand the challenges and perhaps have a different perspective than the Cabinet we have now,” Kerridge said.
Starmer and Chancellor Rachel Reeves caused outrage in the industry last year after botching business rates reform while also increasing employer costs.
Burnham has already pledged to cut business rates and said on Monday that High Streets could become ‘a symbol of Britain’s renaissance’.
The industry groups’ survey also found that almost a quarter (23 per cent) of respondents were operating at a loss; This rate is up from one in seven (15 percent) three months ago.
Eamonn England and Arina Piskunova run Windsor Castle in North London and were recently named top licensees in Britain by the British Institute of Hotel Management.
Even though their work is busy, they have had to reduce their working hours (they don’t work at lunch or on Mondays) and are working more hours themselves.
And the pair say they can’t afford to hire any more young people, and have even had to turn away people who come to the bar asking for work, even though they need more help during the busier summer months.
‘People at university or on some sort of hospitality course are looking for their own unique start, a step towards developing this skill. We need it, they need it too, but it’s not the same for us; ‘We can’t afford it,’ says England.
However, they believe the VAT cut will mean they can hire another member of the team.
Greene King chief executive Nick Mackenzie said the reduction would be a “double win” as it would mean “reversing the decline and at the same time creating growth for the future”.
Businesses are discouraged from hiring younger, less experienced workers, leaving many without their first jobs, he said. ‘TThis is how people gain confidence and this is how they build a career in our industry. “If you lose that, society loses, the economy loses too,” he added.
Greene King CEO Nick Mackenzie worries hospitality businesses are failing to recruit young workers
Wahaca co-founder Thomasina Miers said changes such as the increase in National Insurance in April 2025 were making it ‘very expensive to employ real people’.
He said the main sectors employing people ‘in the AI world’ are ‘the most taxed sectors and so it doesn’t make sense to me’.
His message to policymakers was: ‘Let’s make hiring affordable and not tax companies so much that they can’t make any money.’ So this isn’t about paying people less, it’s about taxation, it’s about taxing people’s payments less.’
The campaign is also backed by chef and Saturday Kitchen guest Mandy Yin, who was forced to close her north London restaurant Sambal Shiok in May.
He said the Government had missed out on £100,000 a year in taxes he had paid because 20 of his staff had lost their jobs.
‘I’m not the only one, there are thousands of other independent operators in the country and right now the system doesn’t work unless you’re a chain with a financial buffer,’ he said.
Restaurant owners have criticized ministers after increases in employment costs, including minimum wages and contributions to National Insurance payments, in the last two years.
They also have to pay for higher business rates from this April, despite a backlash that resulted in the Chancellor making a U-turn on rises for pubs and music venues.
They’re also facing consumer shortages as the war in the Middle East puts pressure on home grocery and energy bills – all while it’s hot inflation It increases businesses’ own content and usage costs.
The government had announced earlier this month that it would reduce the VAT rate on children’s meals, family admission to tourist attractions and children’s soft play to 5 percent between June 25 and September 1.
But campaigners and chefs say it should be rolled out to other businesses.
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