Wednesday’s day of action saw 51 companies pledge to cut prices by 7.5% across their venues – to highlight the difference in price a VAT cut from 20% to 5% would have on the hospitality sector.
Jacques Borel, who is fronting the campaign, described the results as “outstanding”.
He said: “The substantial increase in customers on the day due to the price cut of 7.5% (with some members even making a 15% discount,) was beyond our expectations.
“It proves that when you cut prices by 7.5% you then obtain an increase in customers of 10% to 20% which means that the VAT Club projection of creating 670,000 jobs thanks to a VAT cut from 20% to 5% is possibly a little conservative.
“This also proves that the £7.8bn investment of the Treasury in such an endeavour would almost certainly be covered by the extra income tax and national insurance generated, along with the substantial decrease in social security claims and a considerable increase of corporate tax.
“Tax Equality Day proves that it is probable the £7.8bn investment of the Treasury would be covered by these extra taxes in less than three years.”
Success
Tim Martin, chairman of JD Wetherspoon, said: “Tax Equality Day was a very big success with sales up 11% on a like-for-like basis. We estimate that volumes rose by 20% on the day with a few items reduced to £1.99 such as a pint of Doom Bar. All of our customers and staff certainly now understand the point that is patently obvious – pubs would be able to compete with supermarkets if there was tax equality.”
Nigel Wright, TCG chief executive, said: "Sales on this year's Tax Equality Day were broadly in line with last year's, which were well ahead of the previous year, so we maintained the impact of reduced prices. Just as importantly, many of our sites reported a positive response from customers to the POS, leading to conversations with staff about how the current VAT rate impacts pubs and bars. It was a good opportunity to raise consumer awareness of this important issue and we're pleased to have supported the day."
James Nye, managing director of Anglian Country Inns, said: “Tax Equality Day went really well for us. The increase in trade more than covered the price reduction, supporting the idea that a cut in tax would boost trade. We gained extra trade from the marketing but also raised new awareness from surprised guests who were delighted to find their food and drink was more affordable. All I can ask is that if customers enjoyed it, they should let their MP know so that it can be a permanent feature.”
Awareness
Gavin George, chief executive of Laine Pub Company, said: ”Tax Equality Day seems to have gone well and we had an increase in trade in a number of our sites. It was a good exercise in awareness raising, giving us the opportunity to explain the tax difference. We certainly got behind it in terms of social media and posters in our pubs.”
Oliver Thain, founder of Cambscuisine, said: “Customers were genuinely interested in the disparity and most (75%) were unaware. They certainly enjoyed the 15% discount we gave them on the day and when highlighted that this could be a permanent fixture they got quite animated. It raised an issue that would otherwise go unnoticed and thus worth doing for that reason alone.”