VAT cut set to reduce costs on family leisure and hospitality this summer
Businesses across the leisure, culture and hospitality sectors will be able to implement a temporary VAT reduction this summer under the Government’s ‘Great British Summer Savings 2026’ scheme, aimed at encouraging family days out and supporting seasonal trading.
From 25 June to 1 September 2026, VAT on eligible children’s meals and family leisure activities will be reduced from 20% to 5%. The measure applies across the UK and is intended to support household budgets during the school holiday period while encouraging increased visitor activity across the leisure, culture and hospitality sectors.
The policy forms part of a wider package of cost-of-living measures, including free bus travel for children aged 5-15 in England during August.
What is included in the VAT reduction?
From 25 June to 1 September 2026, the reduced 5% rate of VAT will apply to eligible services including:
- Children’s meals served in restaurants for consumption on the premises – defined as meals served from a children’s menu and marketed, presented and priced as children’s meals.
- Children’s and family tickets for cinema, theatre, exhibitions, shows and concerts
- Admission tickets, for both children and adults, to attractions such as museums, amusement parks, fairs, circuses, zoos, adventure parks, soft play and observation attractions
Sports facilities are excluded, as existing VAT rules continue to apply in that area.
How the scheme works in practice
The reduced rate applies to admissions and eligible services provided between 25 June and 1 September 2026, aligned with the full UK summer holiday period.
For businesses, eligible sales made during this window can be charged at the reduced 5% VAT rate. Where tickets or meals are sold in advance, operators may be able to apply the reduced rate or adjust pricing through refunds where appropriate, depending on how sales have been processed and when legislation takes effect. Season tickets may only qualify where they are priced equivalently to single-entry admissions or are restricted to use within the relief period.
What this means for businesses
For businesses across the visitor economy, culture and hospitality sectors, the scheme will require short-term adjustments to pricing structures, ticketing systems and VAT treatment. Operators will need to ensure that eligible products are correctly identified and that systems are updated to reflect the temporary reduced rate during the summer window.
Clear communication with customers will also be important, particularly where businesses offer a mix of qualifying and non-qualifying products. This includes ensuring transparency across menus, ticketing platforms and online booking systems so visitors understand where the reduced rate applies.
The measure is designed to stimulate demand during the peak summer trading period. Businesses that align pricing clearly and consistently with the scheme may be well placed to benefit from higher footfall across July and August.
We welcome the Chancellor’s announcement that VAT will be slashed on leisure and dining activities over the summer. We have long campaigned for a shot in the arm for leisure and hospitality businesses so we are delighted that they will be receiving this over the summer period. Tourism is a huge footfall driver across our BID area so this announcement will go a long way to encouraging more families down to Marble Arch and Edgware Road to experience our abundance of attractions, including Frameless, MOCO, and the soon-to-open Arts at Marble Arch theatre. More visitors to these attractions will have a hugely positive knock-on effect for our restaurant, hotels and cafes, who will also benefit from the rise in domestic tourists across the summer.
Kay Buxton, Chief Executive, Marble Arch London BID
