Weekly TA update – Autumn Statement initial reaction; EBRS review; VAT on int’l shopping; TA conference wash-up
- Chancellor’s Autumn Statement
- Energy Bill Relief Scheme (EBRS) review – update and contacts
- Business rates
- The true ‘cost’ of the VAT u-turn
- Hope you enjoyed the Tourism Industry Conference – slides available now
- Camping and Caravanning Club’s “Outjoyment” report
Most of the measures contained in the Chancellor’s Autumn Statement were well-trailed in the press. The headlines will be about the additional income tax rate changes, the triple-lock on pensions, and the targeting of energy support next year following the end of the existing relief schemes.
Sadly, tourism and the visitor economy didn’t feature at all in the Chancellor’s statement, and are hardly referenced in the Treasury Red Book, save for the confirmation that the decision to reverse the VAT-free shopping policy previously announced will be maintained (see more below).
DCMS’s budget actually goes up from £1.6bn to £2.0bn next year but back down to £1.6bn for the next two years after that which does not augur well for tourism marketing spend.
Energy Bill Relief Scheme (EBRS) review – update and contacts
The Government’s Energy Bill Relief Scheme (EBRS) is the scheme aimed at non-domestic customers including businesses and the third sector, operated by BEIS. The scheme as currently outlined is due to come to an end on 31st March.
The Treasury Red Book confirms what we heard on a BEIS-led conference call yesterday, that the support the EBRS will provide after 31 March 2023 will be ‘significantly lower, and targeted and those most affected to ensure fiscal sustainability and value for money for the taxpayer’.
The consultation terms of reference state there will be a ‘very high bar’ for firms to receive continued government support.
You can see the terms of reference on the HM Treasury website.
They are expecting to publish the results of their review before Christmas so anyone wishing to make a case directly must do so quite quicky. We were given as a way of responding the email address ebrsreview@beis.gov.uk however, it appears that this review may have shifted from being BEIS-led to being Treasury-led. No other ways of responding have been published as yet, but we will keep you posted.
The Chancellor announced a package of targeted support which he says will help business with rates to the tune of £13.6bn over the next five years, and in particular hospitality and leisure along with retail are highlighted for support.
HM Treasury have published a full Business Rates Factsheet which goes into detail, but specifically on retail, hospitality and leisure:
Protecting high streets from rising inflation: extended and increased business rates relief for retail, hospitality and leisure
- To support high street properties the government is extending and increasing the Retail, Hospitality and Leisure relief scheme from 50% to 75% for 2023-24, up to £110,000 per business. This surpasses the ask of the main business representative bodies.
- This means an estimated 230,000 business properties will get a £2.1 billion tax cut next year.
- A typical small shop with a rateable value increasing from £20,000 in 2017 to £21,500 in 2023 will receive RHL relief worth around £8,000 (subject to the £110k cash cap per business).
- A typical pub with a rateable value decreasing from £31,900 in 2017 to £27,600 in 2023 will receive RHL relief worth over £10,300 (subject to the £110,000 cash cap per business).
- A small property in the retail, hospitality or leisure sectors eligible for the Supporting Small Business Scheme will not see an increase greater than £150 per year, equivalent to £12.50 per month.
- Chains that reach the £110,000 cash cap on relief can also still benefit from the multiplier freeze and transitional relief.
Ratepayers in England will be able to see the future rateable value for their property and get an estimate of what their business rates bill may be from 1 April 2023 through the Find a Business Rates Valuation Service: https://www.gov.uk/find-business-rates (this should be available later today, but is currently offline).
The Government also announced that it will not introduce an Online Sales Tax (OST) which was put forward by some stakeholders in the context of Business Rates reform. The TA submitted that this was not an advisable policy so we are pleased to see this is not being taken forward. The government says its decision “reflects concerns raised about an OST’s complexity and the risk of creating unintended distortion or unfair outcomes between different business models.” A formal response to the consultation is due soon.
The true ‘cost’ of the VAT u-turn
Sadly the Chancellor did not u-turn on his u-turn with regard to VAT-free shopping for international visitors. He would have been well-advised to do so considering the research published this week by colleagues at the Association of International Retail (AIR) and Oxford Economics.
The headline figure is that the Treasury’s estimates were and are way off. Far from there being a £2bn cost in reintroducing the tax-free shopping for international visitors, there would in fact be a benefit to the Treasury to the tune of £350m each year through the direct cost, additional spending and job creation.
You can read the full Report here
You can read the Executive Summary here
You can read the AIR press release here
Hope you enjoyed the Tourism Industry Conference – slides available now
We hope that those of you who were able to join us at our Tourism Industry Conference, hosted in conjunction with British Destinations and The Tourism Society, earlier this week found it a useful and enjoyable day.
I know Kurt, who did a fantastic job in organising the event, has already had lots of feedback, but if you have any more – positive or negative – which may help us in planning our events for 2023, please do not hesitate to send it through to me at Richard.Toomer@tourismalliance.com.
The slide deck from the event is available to download on the TA website.
Camping and Caravanning Club’s “Outjoyment” report
In case you missed it, TA members, the Camping and Caravanning Club, recently published a report they’ve worked on with Liverpool John Moores and Sheffield Hallam Universities. The Outjoyment Report is a significant piece of work which shows the value of camping especially in terms of health and well-being.
91% go camping because it makes them feel relaxed. Campers are 23% less anxious than non-campers. 97% of campers say happiness is their top motivator for going camping.
You can download the full report and get more headlines via www.theoutjoymentreport.co.uk
For your information please also note news relating to VisitEngland’s ‘MeetEngland’ – https://ukevents.org.uk/news/partnernews/1135-visitengland-s-meetengland-leads-european-business-events-trade-mission