BALPPA campaigns for level tax playing field
BALPPA (the British Association of Leisure Parks, Piers and Attractions) tabled a report recently to the UK Treasury calling for a cut in value added tax (VAT).
BALPPA officials are concerned that the earning power of British attractions is being restricted by VAT rates far higher than most other European countries. The deficit between how much foreign visitors spend in the UK and how much UK tourists spend abroad has risen from £3.9 billion to £19.4 billion (€25b) since 1996, while the UK’s overall share of world tourism has shrunk to 4.5%.
“Tourism is a price sensitive industry and price is a key consideration people make when choosing a weekend break, holiday or day out,” says BALPPA chief executive Colin Dawson. “Currently it is often cheaper to visit France or Spain than it is to spend time and money within these shores.”
All European Union member states except for Denmark, Bulgaria and Romania currently apply reduced rates of tax for tourism services. Reducing VAT on tourism services played a key role in Ireland’s economic revival, for example.
BALPPA argues that millions would be released towards the capital investment needed to take on foreign competitors if VAT rates were cut in the UK. Furthermore, the paper shows that a cut to the standard 5% UK reduced VAT rate on tourist attractions admission and accommodation will boost employment and result in savings in social security payments, increased income and corporation tax. It also predicts an additional £440 million (€565m) will be injected into the industry supply chain.
“The industry was a real power house in the ‘90s but decline has sneaked up on us in recent years,” adds Dawson. “A reduction in VAT for accommodation and entry into tourist attractions would be tax positive, create jobs and provide a real signal from the Government that it values the industry and the contribution it can make to strengthening the economy at this time of uncertainty.”
Pictured at the House of Commons for the launch of the new report are (left to right) BALPPA vice-chairman John Bollom, Visit Britain chief executive Tom Wright and Visit Britain chairman Christopher Rodrigues, CBE.