The hospitality industry in the UK was hit extremely hard by the pandemic and now it is facing another setback with the increase in VAT.

Last week, the Chancellor of the Exchequer Rishi Sunak revealed plans to raise the VAT from 12.5 per cent to 20 per cent in his Spring Budget.

In response, UKHospitality said this move would put lots of jobs at risk and lead to price increases for consumers, as bars, restaurants and hotels will struggle to buffer their additional costs.

Chief executive of the group Kate Nicholls said: “This is a real setback for thousands of UK hospitality businesses still suffering the devastating effects of Covid and facing a tidal wave of rising costs.”

She stated it might “prove fatal” for many businesses who were hoping to recoup the losses they have experienced over the last couple of years.

“Locking in VAT at 12.5 per cent would have given hospitality businesses a major boost, and helped the sector in its ambition to lead the UK back to post-Covid prosperity,” added Ms Nicholls.

However, businesses will now have to increase their prices, and many could be left without a job.

One way bars, cafes, restaurants and other hospitality companies could boost their trade is with advertising screens showcasing their branding, name and logo. The more people who catch sight of this, the more customers they can expect to see through their doors.