Business chiefs demand tax cuts to help North Yorkshire tourism beat the recession (From Bradford Telegraph and Argus)

Business chiefs demand tax cuts to help North Yorkshire tourism beat the recession

8:00am Wednesday 20th March 2013 in News By Chris Young, T&A Reporter

Slashing the amount of tax Bed and Breakfast, campsite and caravan park owners have to pay could provide a huge boost for the district’s rural economy.

This is the argument put forward by the Country, Land and Business Association, who have lobbied the Government to make life easier for rural businesses by cutting their costs.

The CLA released its policy on rural tourism yesterday, making a number of recommendations, including cutting VAT on rural tourism services from 20 per cent to seven per cent and calling for Government assurances that B&Bs and guesthouses do not fall prey to the so-called “bedroom tax.”

Released on the same day, a report by business advisory firm Deloitte said Yorkshire’s tourism industry faced a “lost decade” because of the recession, with many businesses not expecting to return to pre-recession levels of business until 2017 at the earliest.

Both groups released their statements during National Tourism Week. Britain currently has the highest rate of VAT for rural tourism in the EU, and the CLA thinks by reducing the figure the government would level the playing field.

CLA North Regional Director Dorothy Fairburn said: “Tourism is a major source of diversification for farmers as well as being the primary business for many who live in the rural North. It is essential that tourism raises its game in terms of quality and scale.

“The prohibitively high rate of VAT makes tourism overly expensive for many prospective visitors. It also discourages farmers from diversifying into rural tourism because it makes sense for them to be VAT registered for their farming activities but not for working as relatively small-time tourism providers.”

One area that would massively benefit from such a cut is Haworth, which has several guest houses and businesses that thrive on tourists coming to see ‘Bronte Country.’ Vanessa Smith, owner of Park Top House B&B in Haworth, would welcome any cut, saying: “It would be brilliant if that would happen. It would definitely make things a lot easier for us. I totally agree with what the CLA are saying. It wouldn’t make things totally secure for businesses like ours, but it would be a big help. Any saving in any area is a good thing.”

The need for government help is highlighted in the Deloitte report, which found that 38 per cent of Yorkshire’s rural businesses think it will take until 2017 for the tourism market to recover, while a further 43 per cent think it will take another three years.

Andy Coticelli, consumer business partner at Deloitte in Yorkshire said: “The results make sobering reading for the Yorkshire tourism sector.

“Firms have had to make a number of tough decisions in recent years to maintain their profitability and the regional market is more challenging than London.”