VAT and Stamp Duty reduction for leisure and tourism industry
On 8th July, Chancellor Rishi Sunak, outlined a number of measures in his summer statement, which he hoped would assist leisure businesses and property owners.
VAT has been cut from 20% to 5% for all hospitality and tourism businesses until 12th January 2021 and Stamp Duty has been removed for houses up to £500,000 until 31st March next year. The Government called it a “£4bn catalyst” that will benefit over 150,000 businesses and consumers and help protect 2.4m jobs.
Tom Good, Associate Partner at Fenn Wright says: “The reduction in VAT will be a welcome relief to many leisure business operators, particularly those who rely on a relatively short, defined season to generate enough income to see them through the quieter autumn/winter period. Although the reduction in Stamp Duty will not directly affect mixed use and commercial properties, many buyers in the lifestyle and leisure markets rely on a residential property sale in order to finance their lifestyle change. The measures may also benefit owners selling property or businesses due to retirement as it will reduce the overall cost of their onward purchase”.
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Sources: The FT