Success of French restaurant VAT cut

New figures from France have highlighted the success of cutting VAT in restaurants to 5.5%. A study by Gira Conseil, France's leading food industry...

New figures from France have highlighted the success of cutting VAT in restaurants to 5.5%.

A study by Gira Conseil, France's leading food industry consultancy, has revealed that the number of people eating in traditional restaurants has increased by 9% in the eight months to August, compared with the same period last year.

The French government slashed VAT in the country's restaurant industry from 19.6% to 5.5% last year.

The restaurant sector generated sales of €79bn (£68bn) in 2009. Tim Martin, the chairman and founder of JD Wetherspoon, has called for a similar system in this country.

He has highlighted the work of French campaigner Jacques Borel, who successfully argued that VAT should be reduced in the country's restaurant trade in a bid to boost the Government's tax coffers.

He told delegates at this year's UK Pub Retail Summit, organised by the Morning Advertiser and M&C Report, that such an initiative would increase the Government's tax take by creating employment.

The study also casts a light on the changing habits of the French diner. It discovered that only 14% of meals outside of the home involved a starter, main and dessert.

The situation has been blamed on the introduction of the 35-hour working week — with workers too stressed to take a longer lunch with wine.

The survey also revealed that in the first eight months of the year the average diner spent 5% less in traditional restaurants and 3% less in fast-food outlets than in the same period last year.

The average bill was €7.74 (£6.71) per head.