Supporting hospitality

The race against time

VAT

The European Commission should recall the opportunity and recommend governments seize the opportunity already permitted in legislation to reduce VAT applied in the hospitality sector, including on the service of beer

  • This policy targets the part of the beer value chain hit hardest and most directly
  • Doing so will put a bit more money into the pockets of establishments, recovering from weeks of zero income, whilst obliged to open at a limited capacity (due to social distancing rules), with damaged consumer confidence (whilst the virus still circulates and no vaccine exists), increased costs on staffing (to clean) and infrastructure (to guide and enforce social distancing) and bills/loans to pay

    Liquidity

    The European Commission and Member States should continue and extend support through grants and loans (with flexible repayment schemes and the postponement/waiving of payments e.g. VAT, social charges etc.) to companies through and beyond gradual reopening, not just during closure

    Flexible interpretation by the Commission of State aid rules can allow sufficient liquidity for all individual hospitality establishments, regardless of their company structure

    • This policy can help ensure all small establishments once again survive and ultimately thrive
    • The raising of the State aid threshold is welcome but rules must be interpreted flexibly to allow an individual establishment which is part of a group to benefit the same as an identical, but independent establishment
    • Such support can ensure economic viability of reopening, compensating for reduced revenues and increased costs of re-opening

    Excise duties

    Commission should recall opportunities in the excise Directives for governments to:

    • Refund excise paid on unsold beer
    • Support small brewers hit hardest with up to a 50% reduction in excise taxes and up to a 200,000hl threshold for defining a small brewer
    • Cut beer excise overall, thereby reducing prices for hard-hit consumers, stimulating hospitality spending, to also boost government revenue
    • Cut tax on beers up to 2.8% abv to stimulate their development and consumption

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