British Destinations

Updates and new items

Posted on February 28, 2022

1. Online Sales Tax. “The UK government has today (25 February 2022) published an early-stage consultation, exploring the arguments for and against an Online Sales Tax (OST)”. The consultation which closes 20 May is potentially the first step towards an online sales tax, equally it could kick the issue off into the long grass or kill the idea off in its entirety. The announcement makes it clear that the rational is to “address tax imbalance reported in the retail sector”. In the consultation itself there are references that suggests that such a tax charged at 1 or 2%, as previewed in last Autumns spending review, could raise sufficient funding to reduce business rates on bricks and mortar based retail, not eliminate them, which is critical to understanding the direction of both the thought process and of potential travel. The consultation has been added to the consultation page of Britishdestiantions.net: https://britishdestinations.net/consultation-responses/open-consultations/uk-government-to-assess-whether-online-sales-tax-could-address-tax-imbalance-reported-by-retail-sector-closes-20-may-22/

2. Covid-19 non-damage denial of access insurance cover. Last week Axa lost a potentially landmark case in the High Court against the hospitality group Corbin and King. The case follows on from the 2020 finds by the City Regulator in large part in favour of the Financial Conduct Authority’s arguments made on behalf of policy holders, originally denied full non-damage denial of access insurance cover payments. The 2020 findings left considerable doubt over many cases, including that of Corbin in King.

In essence Axa, argued that their liability was limited to a single claim £250k over the period of the Covid-19 pandemic and only one claim of up to that value for the groups rather than up to £250k for each of their 9 London-based premises. Axa are “carefully considering” the finding. A specific settlement for Corbin and King will follow from the Courts. However, depending on the wording of policies and the interpretation previously placed on these, the finding may (will) have significant implications for other insurers and for other groups denied sequential and/or multiple claims across their operation. It isn’t going to help single businesses but it may have implications for micro and SME with more than one outlet (?) and presumably on a number of national groups and chains, some sadly no longer operating. It will also doubtless be reflected in future business insurance costs, potentially regardless of the cover previously held or the nature of that being sought in future See more on this from FT at:

https://britishdestinations.net/consultation-responses/open-consultations/uk-government-to-assess-whether-online-sales-tax-could-address-tax-imbalance-reported-by-retail-sector-closes-20-may-22/

3. ClearSights on recovery. The February issue of the BVA-BRDC ClearSights on Covid-19 & recovery has now been published and is available to members via the Britishdestinaton.net, C19 research page. This edition paints a more optimistic picture than we have seen for some time: https://britishdestinations.net/c19-research/ .

4. VAT infographic. The Tourism Alliance of which we are members and a number of the major industry sector trade bodies have produced a one-page infographic setting out the key arguments for retaining VAT on tourism services at 12.5%. I have added the infographic to the research page containing the summary and full-page links which were circulated earlier in February.

Although there are still no direct indictors to suggest that the argument may be accepted before the VAT level returns to 20% at the end of March and a good few indirect, indicator that it is very unlikely, it may well still be useful to circulate the infographic to partners businesses and others (MPs etc.?) with or without the expectation management caveat that campaign’s aim is to: either retain the 12.5% VAT level, or failing that, to regain it at the earliest opportunity. Links to the two reports and infographic can be found at: https://britishdestinations.net/research-and-statistics/

Meanwhile here what it has to say: