Tourism Alliance Update on Chancellor’s Autumn Statement

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).

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 31 March. 

The Treasury Red Book confirms 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. If you wish to respond, please send details to Kathryn Davis (kathryn.davis@visitwest.co.uk) and she will ensure they are forwarded, as no other ways of responding have been published as yet.

Business rates

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 

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. 

A new Oxford Economics report published last week revealed that the Treasury’s estimate of a £2 billion cost to reintroduce in the UK is inaccurate, with Treasury instead set to benefit by £350 million each year through the direct cost, additional spending and job creations 10 November 2022.

You can read the full Report here

You can read the Executive Summary here

You can read the AIR press release here