Why Caravan Tax Could Spell “Last Orders” for Tea Rooms
Holiday treats such as afternoon tea and cakes could be off the menu next year if the
government goes ahead with a proposed new tax regime, a major Lake District holiday park
has claimed.
It says the decision to add 20 percent VAT to the cost of static caravans from this
October will threaten the survival of many small rural businesses throughout Britain as
visitor numbers fall.
Average caravan prices will increase overnight by around GBP6000 if the proposal goes
ahead, claims Henry Wild of the 300-acre Skelwith Fold caravan park in Ambleside.
His warning comes after a period of consultation by the government on its VAT plans
ended last Friday (18 May), during which the move was heavily criticised by many MPs from
all parties.
Village shops, pubs, tea rooms, visitor attractions and other enterprises will be
among the unintended victims of the price hike, believes Mr Wild.
He said that fresh evidence about the damaging impact of the new tax has now been
presented to ministers by the holiday parks trade organisation of which he is the regional
Cumbria director.
Over 400 holiday parks which took part in a survey by the British Holiday and Home
Parks Association said that putting VAT on holiday caravans will cause a slump in caravan
sales of just over 50 percent – resulting in almost 4000 job losses on parks.
On top of that figure, says Mr Wild, will be the jobs axed by the many other
businesses which rely on the tourism trade for their survival, some of which may be forced
to close:
“The government has got its figures massively wrong on this one,” said Mr Wild.
“At the time of the budget when this measure was announced, the Treasury said they
expected that sales of holiday caravans would drop by thirty percent after the new tax was
introduced.
“Not only has the new survey now shown to be wrong, but they clearly failed to take
into account the knock-on effect which falling caravan sales would have on small rural
businesses.
“We have been very encouraged by the strong lobby against the tax which has sprung up
since the announcement, and hope the voices of dissent will have been heard and heeded,”
said Mr Wild.
