Tourist businesses worth billions may close because they are excluded from Government’s Coronavirus tourism and leisure rate relief scheme 01/05/2020
Trade associations representing thousands of tourist businesses, together with the Local Government Association, have written to the Chancellor of the Exchequer asking him to urgently change civil servants’ interpretation of his Coronavirus Business Rates Relief Scheme, launched to support the UK’s hospitality and leisure industries.
Tour and coach operators, English language schools, destination management organisations and tourism and hospitality charities are being excluded from the scheme despite Rishi Sunak specifically extending it to all businesses in the hospitality and leisure industries on March 17. He said: “Every single shop, pub, theatre, music venue and restaurant, and any other business in the retail, hospitality or leisure sector, will pay no business rates whatsoever for 12 months, and if they have a rateable value of less than £51,000, they will now get a cash grant as well.”
However, guidance from the Ministry of Housing, Communities and Local Government says any relief to these businesses does not qualify for support because they are not in premises which customers enter to make a purchase. “This distinction is both arbitrary and counter to the Chancellor’s repeated statements that ALL businesses in the leisure sector are eligible for support,” says the letter, adding: “Failing to support these businesses puts at risk many thousands of businesses that generate a large percentage of the £25bn per annum that the UK earns from inbound tourism.”
Kurt Janson of the Tourism Alliance which co-ordinated the letter from eight tourism, English language teaching and transport trade associations as well as the Local Government Association, said: “It is hard to see how these businesses do not qualify as part of the leisure sector in Government eyes. If this is not a lack of understanding, it is a false economy: these businesses generate so much income and so many jobs for local communities that it will be devastating if they are forced under through lack of support.”
Confederation of Passenger Transport UK (CPT) Chief Executive Graham Vidler said: “The coach industry is central to the leisure sector and it is deeply disappointing that this decision has been reached. It suggests a worrying lack of understanding from government about the sector. Coach tourism contributes over £7bn a year to the UK economy helping ensure people can enjoy sporting events, festivals, theme parks, theatres and trips to tourism hotspots across the country. With the industry facing an 18-month winter this funding would have helped provide a much-needed lifeline to businesses that we need to survive the current crisis to help the leisure industry gear up quickly as soon as it is able to do so.”
The letter has also been signed by the Local Government Association, whose members will only be reimbursed for granted business rate relief to tourism businesses if they fall within the official scope of the scheme. The LGA is highlighting the importance of supporting these businesses and the wider tourism supply chain, as their failure will significantly impact local communities, including the ability of councils to raise income to reinvest in local public services.