Taxed Out: Why Hospitality Can’t Afford to Be Ignored This November

Welcome to this edition of Point of View, where we share perspectives from the voices shaping Britain’s hospitality industry. In this column, Kate Nicholls OBE, Chair of UKHospitality, offers her insight on the challenges facing the sector — and why it’s time for government to listen.

When I joined Stelios on The Ceres Podcast, I spoke from the heart about the battle our sector is facing. For me, this isn’t an abstract debate about fiscal policy – it’s about real people, real businesses, and real communities that risk being hollowed out if we don’t get urgent government action.

Every day, hospitality operators are forced into impossible choices: cutting shifts, reducing opening hours, shelving investment in staff and premises. These aren’t just numbers on a spreadsheet – they are livelihoods, futures, and the beating heart of our high streets.

Since the 2024 Budget, we’ve lost 84,000 jobs in hospitality . That’s not a blip – it’s a crisis. For context, over the past decade, hospitality has on average created 26,000 jobs each year. Instead of being a job creator, we’ve been turned into a job destroyer. And the tragedy is, it’s not inevitable. It’s policy-driven.

Take National Insurance Contributions (NICs). Last year’s decision to lower the employer threshold has dragged hundreds of thousands of part-time colleagues into higher tax. The very flexibility that makes our industry tick – employing students, parents, and returners to work – is now penalised. It’s no wonder we’ve seen job losses spiral.

Then there’s VAT. While other countries support their hospitality sectors with a reduced rate, we’re stuck paying the full 20%. That puts our tourism industry at a disadvantage and keeps money out of the tills of the very businesses that could be growing, investing, and hiring.

And let’s not forget business rates. Our high streets – which are vital social and economic resources – are being punished by a tax system that ignores reality. Before the Budget, hospitality already paid twice as much tax as financial services as a proportion of pre-tax profits . Think about that. A sector built on small margins, community impact, and social mobility is taxed more heavily than the banks.

Hospitality is not just an industry – it’s a powerhouse. The UKHospitality Social Productivity Index proves it: we’re the top-performing sector when it comes to creating socially valuable growth . We’re the number one employer of under-25s, part-timers, and non-graduates. We’re bigger than aerospace, automotive, and pharmaceuticals combined. Yet we’re being taxed out of existence.

That’s why our #TaxedOut campaign is so important. We’re calling for three simple, immediate fixes:

1. Lower business rates – apply maximum discounts for properties under £500,000 rateable value and remove the surcharge for larger ones.
2. Fix NICs – extend exemptions to young people and those returning from welfare, reversing the perverse disincentives created by the last Budget.
3. Cut VAT – bring us in line with our European peers, stimulate demand, and free up cash to invest in jobs and growth.

But here’s the truth: I can’t do this alone. Neither can UKHospitality. The most powerful voice isn’t mine – it’s yours.

If you’re reading this, I urge you to take action. Write to your MP. Even if you’ve done it before, do it again. Ministers are new, and they’re telling us they aren’t hearing enough from backbenchers about hospitality, about job losses, about NICs. Invite your MP into your restaurant or café. Let them see your bills, meet your team, and understand the choices you’re being forced to make.

This November, the government has a choice: continue with policies that destroy jobs and stifle growth, or back an industry that is proven to create opportunity, social mobility, and community value.

We’ve been ignored long enough. Let’s make sure they can’t ignore us any longer.