11/06/2026
UNCOMFORTABLE FACT ABOUT VAT IN THE UK
Too high VAT rate for hospitality industry in the UK was brought up to topic for a long x 100 time ago. Yet nothing is changed and we are still shouting out to lower the VAT for hospitality industry. Without understanding how VAT works or what VAT means, it will be left only as a shout for a help but not changing any.
When i got a question from few customers; what is wrong with paying more tax if you earn more money? Well... of course what she said was true but she definitely did not understand what VAT means. VAT has nothing to do with restaurant's profit but customer MUST pay 20% top of the bill for paying HMRC. Here, restaurant's are standing only as a bridge from customers paying VAT to deliver to HMRC.
Here are 2 facts:
1. If the bill is 20% more charged than the bill due to VAT, customers complain that it is too expensive. (VAT makes price to customers not competitive).
2. If the restaurant does not increase the price including 20% VAT then they have to pay 20% VAT from the margin. Then the restaurant will suffer from no money after paying VAT. And bankrupt and close the restaurant.
Plus, this ridiculously applying VAT on food makes everything more complicated and unfair. That makes some companies escape from paying VAT even though they are selling food.
Supporting local and independent business is important but without changing and learning this faulty system of charging VAT, we will always be back with echoing shout out for a help.
Strong tight my hospitality working and running friends, I hope my little shout out would be one day reach to some people who would know about what kind of life we are living in.
We, hospitality businesses, will have to live and survive. We offer your sons and daughters jobs and experience in their life.
VAT is fair money to pay as tax, when it is fairly charged. Right now, it is threat to us down. Without your voice or understanding of fair VAT for hospitality business, you will only witness more and more restaurant/ pub/ bar closure every year.
I have not given up the hope. I will be always here hoping for being fair.
Love with hope, Eunji xx