Pubs Plot ‘Tax Break Tart’ Rebellion

As operators scoff at the Chancellor’s gift, one Kensington venue is touting a £25 “kids” menu of burgundy snails and anchovy butter toast.

Cafes and restaurants are set to dream up more ways to milk tax breaks on meals for under-18s, after a London venue unveiled a “kids” menu featuring burgundy snail salad and anchovy butter bread.

Rachel Reeves last month announced a temporary reduction in VAT on baby food, from 20 per cent to 5 per cent, which will take effect between 25 June and 1 September. The cuts are part of the “Great British Summer Savings Scheme” which has been pitched as a relief for hard-pressed areas and a welcome drink for families. – Business Matters explained how Great Britain’s summer saving scheme works here.

The chancellor flagged the policy in a video address at last week’s UKHospitality trade conference, where it was met with a notably muted reception.

Afterward, top trade figures added their voices to a growing chorus of derision, calling the plan “ridiculous” and comparing it to an estimated £5bn in extra costs for pubs, hotels and restaurants since Labor returns to power in 2024.

Chris Jowsey, chief executive of the 1,300-strong Admiral Taverns group, called the measure “a joke”, saying the existing discount was “embarrassingly small” and would do nothing for pubs that don’t serve food.

He likened the VAT cut to pandemic-era laws that, at one point, allowed venues to serve alcohol only if it came alongside a scotch egg. “I suspect you’ll find a wonderful interpretation of the children’s menus,” she said.

One restaurant in Kensington, west London’s affluent neighborhood, has already implemented a policy to topple the price.

Blue Stoops has launched a £25 menu aimed at any “kids” who like wild burgundy snails with bacon, buttered anchovy toast, and beef and oyster pie. The list includes a dessert named Tax Break Tart. Non-alcoholic beer is included, meaning every package qualifies for a summer reduction from 20 to 5 percent.

“We don’t expect queues of children looking for snails and anchovy toast, but a proper discussion has begun in the pub about why VAT support for tourists should go ahead,” the venue said.

Worse, restaurants and bars are under no obligation to verify that anyone ordering a discounted children’s meal is actually a minor.

Clement Ogbonnaya, who owns the Prince of Peckham in south London, dismissed the discount as a “token act” that would achieve little without a permanent cut in the headline rate. “We will all be falsifying our IDs to show that we are under 18,” he joked.

At the UKHospitality conference, operators lined up behind a call for VAT on hospitality to be reduced from 20 per cent to 10 per cent. A parliamentary petition supporting the move has already gathered more than 200,000 people, and can be found on the UK government’s petition site. The campaign is backed by celebrity chefs including Tom Kerridge and Yotam Ottolenghi, as well as potential Labor leadership challenger Andy Burnham, who has challenged the VAT cuts. Estimates of the annual cost to the Treasury range from £10.5bn to £13bn.

The case rests in part on international comparisons. While the UK rate sits at 20 percent, the European average is 12.8 percent. France, Spain and Italy all charge 10 percent, while Germany charges 7 percent. UKHospitality, which is organizing the campaign, says the gap leaves Britain’s properties in a structural disadvantage.

In his video message, Reeves emphasized that the government supports the industry. The reception floor is different. Hospitality investor and former Dragons’ Den producer Sarah Willingham told guests that when the Chancellor described Labor as promoting growth, he “almost spit out my water”. The chief executive of Nightcap, owner of the Dirty Martini and Piano Works chains, has described the investment climate in the UK as a “shitshow”.

Labor, facing mounting energy bills in the wake of the Iran war, has put together a series of Labor measures, among them a higher national minimum wage, an increase in national insurance contributions and changes in business rates. The squeeze is already showing in closures data, with three pubs and restaurants now closing every day as costs and taxes rise.

“They say they are doing it for the workers, but what they are doing is making it difficult to hire workers because it is very expensive,” said Matt Francis, owner of the Planet of the Grapes wine bar chain in London. “They think that all business people drive around in a Ferrari with money in our pockets.”

Francis added that he had just returned a government loan when he was forced to close during the violence. “My reward is to pay more taxes. I will not vote for them again.” Regarding the summer discount, he was blunt: “We’ve reached a point where it’s laughable, not funny. And there’s a big difference.”

A government spokesman said: “Businesses across the country have welcomed Britain’s summer savings programme, which will reduce VAT from 20 per cent to 5 per cent on children’s meals, cinema and theater tickets, and family attractions this summer. This will help families enjoy a few days off while boosting business growth across the travel and leisure sector.

“We are also supporting hospitality by changing business rates, including a £4.3bn support package to limit rising debt, cap business tax at 25 per cent, cut red tape and tackle the cost of living. We have the right plan to grow the economy and support families and businesses with rising costs.”