High prices affecting South West businesses

Simon Chudley believes a cut in VAT could make a big difference to hospitality

Some small businesses in the South West are calling for more support and a cut in value added tax (VAT) to help them stay open to customers. Business owners have been sharing their views on what they would like to see from the next government ahead of the general election on 4 July.

Simon Chudley runs the London Inn in Okehampton, Devon - he kept his business going during the Covid pandemic by delivering food to his customers with a VAT rate that had been dropped from 20% to 5%.

Mr Chudley believes another VAT cut could make a big difference to hospitality.

"I think a lot of people are rallying for that - 20% on food really is high," he said.

"If they drop that to 5% I could put plates of food out for pretty much the same as you could do them for at home.

"More people would then come out, boosting the economy that way... people can't afford to eat out. If you can come out and eat out for the same as you can at home you will be more inclined to do that."

'Morale is low'

Mr Chudley said high energy prices were also affecting the ability of people to spend money on going out.

He said: "I think a lot of people can't afford to come to the pub, it's not that they don't want to they just can't afford it - energy is through the roof.

"People's morale is low. If you're stuck at home seven days a week 24 hours a day because you can't afford to go anywhere, you're going to start feeling sorry for yourself.

"Then you've got depression and mental health issues - they're gonna go up then the government will have to put more money into those sort of areas."

Katherine Johnston wants to be able to open her fish and chip shop at lunch time again

Katherine Johnston runs a fish and chip shop in Camborne, Cornwall, and said her business had been fighting increasing costs.

She said: "Fish prices and fat - they've both doubled and then on top of that having being cooked it also then has 20% put on it for VAT, which is quite a lot to come from the business.

"We've had to shut a couple of lunches [a week] now to keep our costs down. It's just everything is going up every week, all our products are going up.

"It's really hard."

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Lucy Brint hopes keeping free parking in the towns will encourage people in

The Red Lion Bazaar in Okehampton supplies "everything and anything" including household and outdoor goods.

Co-owner Lucy Brint said with general costs rising, she would like the next government to prioritise stability for small businesses.

She said: "I would like to see a continuation of reduced business rates for small businesses - that really helps. We would like to see some more stability with utilities - obviously prices have risen quite a lot in the last few years.

"What we don't want to be doing is knocking that price increase onto our customers. We want to remain affordable and the cost of living is obviously a problem at the moment."

Ms Brint said the potential of pay and display parking being introduced would be "a really bad idea" for businesses in Okehampton.

"We want people to be able to park easily and move through the town easily. Look at the traffic situation to encourage more shoppers in to support the small businesses."

Liam Hamilton also hopes parking will be kept free

Liam Hamilton runs Hamilton’s barber shop in Redruth, Cornwall.

He wants more to be done to reduce prices for businesses and parking, so the costs do not put people off visiting towns.

He said: "There's so many places outside the towns where you can go and park for free, jump in the shop and go.

"If you want clients to come here and only pop in and out, they're not really going to do it because they're not going to pay for their parking fees.

"It's quite expensive around Cornwall."

Susan Kendall hopes self-employed people will be better supported when sick

Susan Kendall runs a fabric and sewing shop in Okehampton - she hopes the next government will provide a safety net for self-employed people like her when they get ill.

She said: "Last year when I had to have an operation I had to take out a loan to have private treatment because there was absolutely zero support for somebody who has been paying the National Insurance all their life and paying their tax.

"Generally in a small business you're working month to month, pretty much breaking-even, making small profits, if any - so anything that undermines you health wise is going to undermine the business."

Labour, the Conservatives and the Liberal Democrats have all ruled out raising VAT after the election.

If re-elected, the Conservatives said they would provide a "business rates support package" and £20m each to 30 towns in an expansion of its levelling-up policy.

Labour has promised to overhaul the business rates system to help revitalise the high street if elected, saying reforms would level the playing-field for town based shops against online businesses.

The Liberal Democrats also said they would look at overhauling the business rates system.

The Greens said they would set up regional mutual banks to drive investment in decarbonisation and local economic sustainability.

Reform UK said it would bring in "critical reforms", including reducing corporation tax and lifting VAT thresholds to "free up small entrepreneurs from red tape".

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