Wrexham video calls for ‘level playing field’ on business rates and 10% VAT reduction for hospitality

A video has been published sharing first hand accounts from local hospitality business as they ask for changes in UK and Welsh Government policy.

They are asking for Welsh Government to match a business rates relief of 75% as in England, in Wales that will be set at 40%.

UK Government are also being asked to cut VAT in the hospitality sector from 20% to 10% to help sustainability amid wide ranging financial pressures.

The video filmed last week has local businesses explaining how the effective business rates increase and VAT issues are all part of wider pressures on the sector, that include many shared by households – such as rising costs of good and energy.

The Lemon Tree’s Sam Regan, who is also chair of the This Is Wrexham tourism partnership, observes, “Some business owners have even gone as far to say that they don’t know how they’re going to pay their VAT bill in the next quarter”

Hannah Grew from Levant says of business rates, “They are essentially removing the relief when nothing has settled down.

Mr Regan describes the situation as worse than during the pandemic, “During covid we were supported, now we are on our own”.

Alex Jones from The Bank pointed to Atik’s recent closure and the impact for the night time economy locally, “North Wales’ biggest nightclub has just closed its doors and gone into administration. That’s looming over everybody and a weight on everyones shoulders.”

Head Chef Eliot Knox adds, “I’m speaking to friends who I’ve worked with in the past, everyone’s feeling the pinch, and you only have to look at places that are closing all the time, it’s sad to see really, good friends losing their businesses, you just don’t want to see that.”

Sarah Baker from Lot 11 points to the take over of Wrexham AFC by Rob and Ryan as helping matters locally, “I say thank goodness for Wrexham being in the spotlight. Otherwise, without the football, we completely be struggling.”

Mr Regan added, “Year on year, the picture just keeps getting grimmer. The costs keep getting greater to operate these hospitality businesses. We employ collectively into the 1000s of people and every single one of those businesses is feeling the pressure in terms of rising cost.”

“You could walk out of one coffee shop in Wales into another coffee shop in England by just by crossing the road. That coffee shop has has a 40% rate relief, and then walk across the road, it’s just in England, it’s got 75%. That’s got major implications.”

Hannah Grew detailed the VAT issue, “People sometimes misunderstand VAT they think that we just pay VAT on the profit you make. If you don’t run a business, you don’t understand that, we pay VAT on every pound we take , for every pound we take they essentially take 20% off us.”

The video rounds off with a range of local businesses asking to ‘make it a level playing field for England and Wales’ and ‘reduce vat for hospitality to 10%’.

The full video is below:

The local effort was inspired from a viral video in Manchester, with similar themes echoed locally:

‘THIS IS AN EMERGENCY’ – MANCHESTER’S HOSPITALITY SCENE CALLS FOR GOVERNMENT TO REDUCE VAT TO 10%

Our hospitality scene is in crisis.

Restaurants across the country are closing at an alarming rate, and many chefs, owners and operators across Manchester are ‘on a cliff edge’.… pic.twitter.com/vC1WcPn1Mr

— Manchester’s Finest (@McrFinest) January 30, 2024