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The Government’s pledge to cut VAT on food, accommodation and attractions from 20% to 5% and the implementation of the Eat Out to Help Out discount has been welcomed by the industry as a way to help farmers recover and get British produce back onto people’s plates.
Chancellor Rishi Sunak announced the discount last week as part of a package to boost the hospitality sector, which he said will help to protect 1.8 million jobs. Meals eaten at participating establishments will have up to a maximum discount of £10 per head for everyone, including children. Businesses can register to take part from today and the discount will apply during the month of August.
NFU president Minette Batters said that the reopening of the hospitality sector is “significant for British farmers and it will play a central role in farming’s recovery.”
Ms Batters added, “We hope the announcement to stimulate the hospitality and tourism sectors by cutting VAT will see increasing demand which will help British food flow back into our pubs, cafes and restaurants. This will start to ease the pressure many farm businesses are facing.
“There are thousands of diversified farms with tourism and hospitality businesses that could also benefit from the stimulus created by this cut, helping them to play a key role in reviving the economy. The ‘Eat Out to Help Out’ discount could also play a significant role to stimulate demand for the quality British produce they supply.”
Matthew Knight, managing director of RABDF, also welcomed the announcement. The organisation was one of many that wrote a letter to DEFRA back in April to help save the dairy industry from the impact of cafe and restaurant closures.
He says, “The dairy market suffered a huge shock due to the instant closure of cafes and restaurants during the COVID-19 pandemic, with orders from the foodservice sector dropping by about 70-80% during this period. About 1m litres of milk goes into this sector every day so it is encouraging to see this sector starting to open up again and the Government’s Eat Out initiative will aid this. This will of great relief to those farmers supplying processors feeding into the foodservice sector as well as producers, particularly those specialist non-bovine milk producers who supply products such as goats and buffalo cheese to the ‘out of home’ catering market.”
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