Pubs’ hope for VAT cut dashed after minister’s cost warning – despite Burnham supporting tax slash before entering No10

PUBS hoping for a VAT cut were dealt a blow yesterday after a Treasury minister warned slashing the tax would cost “a lot of money”. James Murray cooled hopes of cutting hospitality VAT from 20 to 10 per cent despite Andy Burnham backing the move before becoming PM. Treasury Minister James Murray Credit: Getty Andy Burnham backed calls for a 10 per cent hospitality VAT rate before entering No10 Credit: Getty The Financial Secretary to the Treasury said any cut would have to be “fully funded” and offer taxpayers value for money. He told The Sun: “We want to support hospitality, but let’s be upfront about this. “If you’re having a big cut in VAT, it costs a lot of money, and anything that we announce, we want to make sure it’s fully funded, and we explain exactly how we’re going to do that. Sign up for the Politics newsletter Thank you! “So, when the Prime Minister announced 20 per cent cut off business rates last month, we said exactly how we were going to pay for that.” Mr Murray insisted he would “not get ahead of anything that might be announced at the Budget”, adding: “But we need to keep looking at how we can support high streets and particularly pubs because they’re so important to everyone right across the country.” Mr Burnham backed calls for a 10 per cent hospitality VAT rate before entering No10, arguing the sector needed more help. Top chefs including Tom Kerridge threw their weight behind his stance at the time. But the Government has so far focused its latest support on business rates, announcing a further 20 per cent reduction for pubs from April 2027. The Treasury has also launched a review into the way pubs and hotels are valued for business rates after sharp increases at the 2026 revaluation. Most read in The Sun UKHospitality boss Kate Nicholls said: “As the Prime Minister acknowledged earlier this year – and as we have seen this summer – cutting VAT is the fastest way to tackle the cost of living, make everyday treats for families more affordable and bear down on inflation. It boosts consumer confidence, generates economic growth and much needed tax revenues and has the quickest payback in terms of jobs. “If the PM is serious about delivering growth in every postcode, a high street renaissance and tackling the NEETs crisis this is the lever to pull.” Comment now