Restaurateurs, publicans and cafes owners have urged the next Prime Minister to slash VAT to prevent further venue closures and the decimation of youth jobs.

One in six businesses are at risk of closing in the next 12 weeks, according to new research produced by the British Institute of Innkeeping, UKHospitality, the British Beer and Pub Association and HospitalityUlster.

Tom Kerridge, who is a familiar face on cooking television shows including Saturday Kitchen and Bake Off, called on the public to put pressure on politicians for a VAT cut.

He led calls from small business owners for the tax to be cut from 20 per cent to 10 per cent to help businesses avoid closures, job losses and price cuts.

It comes as Ireland will tomorrow (Wednesday 1 July) cut its VAT rate for hospitality from 13.5 per cent to 9 per cent.

Hospitality operators say they are struggling to make ends meet due to high costs ranging from energy, wages, National Insurance contributions, food, beer duty and business rates.

Bringing the UK’s VAT rate in line with what is paid by businesses in the rest of Europe would help, they say.

Kerridge, whose site, The Hand & Flowers, was the first gastropub in the UK to be awarded two Michelin stars, said hospitality employers want to help with rising levels of youth joblessness but are struggling to hire.

Kerridge said: ‘Hospitality isn't employing at the minute, it's stagnating, it's moving backwards, it's closing down. Those jobs aren't there, and they're not available to young adults right now.’

The chef hopes that venues across the country will start putting up posters to raise awareness of UKHospitality’s ‘VAT’s The Problem’ campaign – to encourage customers to sign a petition.

He said he was optimistic that Andy Burnham – who has launched his bid to replace Keir Starmer as Prime Minister – would be supportive of the idea of a VAT cut.

‘We hope that he's going to understand the difficulties and maybe take a different perspective from the Cabinet we have currently got,’ Kerridge said.

Starmer and his Chancellor Rachel Reeves have caused ire among the sector after botching a reform of business rates last year while also hiking employer costs.

Burnham has already pledged to cut business rates and said on Monday that High Streets could become ‘a symbol of Britain's renaissance.’

The industry groups' research has also found that almost a quarter of respondents (23 per cent) are operating at a loss, up from one in seven (15 per cent) three months ago.

Eamonn England & Arina Piskunova run The Windsor Castle in North London and have just been awarded the British Institute of Innkeeping’s title of the best licensees in Britain.

Despite their business being busy, they have had to cut back on their operating hours – they don’t open at lunchtime or on Mondays – as well as working more hours themselves.

And the pair say they cannot afford to hire any more young people and are even having to turn down people coming into the pub asking for work, despite needing more hands on deck in the busier summer months.

‘It’s people at university or doing some kind of hospitality course, they are looking for their kind of start, their step up, for that upskilling. We need it, and they need it, but it just doesn't equate for us - we can't afford it,’ says England.

But a VAT cut would translate into them being able to hire one more member of the team, they believe.

Greene King chief executive Nick Mackenzie said that a reduction would be 'a double win' as it would mean 'reversing a decline and also creating growth for the future'.

He said businesses have been discouraged from hiring young, less experienced workers – depriving many of their first jobs. 'That's how people get confidence, that's how people end up having a career in our sector. If you lose that, then society's losing out and the economy's losing out,' he added.

Thomasina Miers, the co-founder of Wahaca, said that changes such as the increase to National Insurance in April 2025, have made it ‘very expensive to employ real people.’

She said that in ‘a world of AI’, the main industries which employ people are ‘being the most taxed, so that for me doesn’t make sense.’

Her message to policymakers was: ‘Let's make it affordable to employ workers and not tax it so much that companies aren't making any money at all. So it's not about paying people less, it's about taxing, it's about taxing the payment of people less.’

The campaign is also being backed by chef and Saturday Kitchen guest Mandy Yin, who was forced to shut her north London restaurant Sambal Shiok in May.

She said the Government has now missed out on the £100,000 a year she paid in tax while her 20 staff lost their jobs.

‘It's not just me, there are thousands of other independent operators up and down the country, and right now the system just does not work unless you are a chain with a financial buffer,’ she said.

Restaurant owners have criticised ministers after increases to employment costs including minimum wages and contributions to National Insurance payments over the past two years.

And they have also had to fork out for higher business rates from this April, despite a backlash resulting in the Chancellor U-turning on hikes for pubs and music venues.

They are also facing a consumer squeeze as the war in the Middle East has heaped pressure on household grocery and energy bills – all while hot inflation spikes businesses’ own ingredient and utility costs.

The Government earlier this month said it would reduce the VAT rate to 5 per cent for children’s meals, family admissions to visitor attractions and children’s soft play between 25 June and 1 September.

But campaigners and chefs say this must be extended more widely to other businesses.