The British government has taken a notable measure to reduce VAT on children's activities during the summer holidays from 20% to 5%. This makes outings and holidays more attractive and gives the leisure sector a boost. The measure covers, among other things, children's tickets for amusement parks, cinemas, zoos, playgrounds, and children's menus in restaurants.
The scheme, which runs from June 25 to September 1, is part of the 'Great British Summer Savings' package, presented by the British government as a purchasing power measure. The discount is intended to enable as many children as possible to enjoy their summer holidays. Their parents, however, pay the full Pound.
At the same time, the measure is intended to ensure increased visitor flows towards attractions, hospitality establishments, and recreational facilities. The price reduction certainly plays into the hands of entrepreneurs. However, there are still a number of points of attention regarding the scheme:
- The British government is explicitly urging providers to actually pass on the tax benefit to consumers. Lower entrance fees are expected to generate extra demand during the peak summer holiday period. Payment systems must also be configured to handle different VAT rates throughout the period.
- Operators must familiarize themselves thoroughly with the regulations, as not all offerings fall under the exception. For instance, children's menus must be explicitly positioned and priced as children's offerings; takeaway meals are excluded from the scheme. At cinemas, theaters, and similar providers, not all tickets are automatically subject to reduced taxation: the conditions vary by ticket type and family package.
An amount of 300 million British Pounds has been reserved for this government discount campaign.
Source and more information: Temporary reduced rate of VAT for children's meals, tickets and family attractions – GOV.UK