The British Retail Consortium called for a wider VAT cut to include retail goods to help support the industry while footfall is far from pre-pandemic levels.
The trade body said the new policy, which sees a temporary cut to 5% from 20% for cafes and restaurants, may benefit retailers located near food venues.
“With lockdown measures easing, consumers are slowly re-emerging onto their high streets, shopping centres and retail parks,” said Helen Dickinson, chief executive at the consortium.
“UK recovery has been sluggish, especially compared with European standards, but retailers with stores remain hopeful that the reopening of hospitality will provide a welcome boost.”
In the three weeks to July 4, footfall was 53% below last year’s levels following the reopening in mid-June of non-essential businesses in England and Northern Ireland.
The high street saw a steeper decline compared to retail parks, which were only down 26% on 2019, as they benefit from larger spaces and a broader offer.
Pubs and restaurants have also been trading at around half of normal levels.
According to the Coffer Peach Business Tracker, pub sales during last weekend’s reopening dropped 45% on last year.
Around 40% of chain pubs reopened on the so-called ‘Super Saturday’, against 12% of chain restaurants, which saw sales falling by 41%.
“Trading at around 55% of pre-Covid norms may seem a disappointing result, and it won’t be profitable for operators, but it is very much in line with what we have seen in other markets,” Karl Chessell, director of consultancy CGA, was quoted as saying by the Evening Standard.
“When bars and restaurants began reopening in the US during May, it was only after a couple of weeks that sales reached 54% of pre-Covid levels.”
Published at Fri, 10 Jul 2020 11:34:00 +0000-Coronavirus: UK retailers call for wider VAT cut as shoppers slowly return to high street