During Welsh Questions today Roger Williams MP asked the Secretary of State whether he believed reducing VAT on visitor attractions and accommodation would stimulate tourism and result in a higher tax-take.
There is a growing belief that the UK might follow other EU countries and reduce VAT on the Tourism and Hospitality Trade. It is being proposed that VAT on visitor attractions and accommodation be reduced from 20% to 5%. This is the state of play in 25 EU countries. Although this may lead to a reduction in the tax take in the Treasury in the short term there is plenty of evidence that the tax take will increase as more people take more and longer holidays. Rural Wales is particularly dependent on tourism as the second largest sector in the local economy, and so would be well placed to benefit from such a move.
Commenting Roger Williams MP for Brecon and Radnorshire said:
“It is absolutely vital that we improve opportunities for the tourism industry in rural areas in Wales. My constituency of Brecon and Radnorshire has so much to offer. But we need to take further initiatives to highlight the excellent facilities and improve conditions for tourism businesses.
“I am so pleased that Katherine Jenkins will lead the VisitBritain’s Countryside is GREAT Campaign in New York. The theme will be that visitors from abroad should visit the countryside as well as our cities. I cannot think of a better advert for the Welsh Countryside than the Welsh Songstress Katherine Jenkins. I shall be following the event to see what benefits accrue to Wales”
During Welsh Questions in the House of Commons, Roger Williams asked:
Tourism is very important to Wales, and to rural Wales in particular. It has been suggested that reducing VAT on visitor attractions and accommodation, as other EU countries have, would stimulate tourism and result in a higher tax-take. Does the Secretary of State agree with that view?
Secretary of State for Wales Mr. Stephen Crabb replied:
I am familiar with the VAT arguments from the tourism sector. Of course these matters are the responsibility of the Chancellor of the Exchequer and he keeps them under review, but I would just point out to my hon. Friend the most recent tourism visitor figures, which showed about an 8% increase last year in international visitors coming to Wales. That has to be a good sign that the tourism sector is on the up in Wales.
Photo from http://www.breconbeaconsparksociety.org/