Caravan tax would be tourism "blow"
3:30pm Saturday 12th May 2012 in News
Pembrokeshire's tourism industry could suffer a potential £6million blow if a proposed Government tax on caravans comes goes ahead, it’s being said.
With around 6,800 static vans in the county on more than 70 holiday parks, it has been estimated that a 20% VAT increase could see the average park losing as much as £900 per pitch.
Plans for the price hike were unveiled in the Budget and are due to come into force in October.
MPs and holiday sector leaders are now campaigning for them to be quashed.
Currently, purchasers of static caravans only pay VAT on its interior items.
The price of a van which is now £25,000 would cost £30,000 if VAT was applied.
With the consultation period just extended until May 18th, local operator Huw Pendleton is urging everyone affected to add their voice.
Mr Pendleton is managing director of Celtic Holiday Parks, and also chairman of Pembrokeshire Tourism and the national vice-chairman of the British Holiday & Home Parks Association.
He told the Western Telegraph: “The Government has co-funded a £100million campaign to attract international visitors, and yet, at the same time, is trying to tax one of the most traditional of British holidays out of the reach of many”.
He added that if the proposals are brought in, they would have ‘a very negative impact’ on the tourism sector.
“I am concerned what these negative effects will have on the economies of my own business, and that of the industry on a wider scale, “ he added.
Government figures have forecast a 30% decline in caravan sales, but did not take into account the effects to the supply chain, he pointed out.
He has just met Carmarthen West and South Pembrokeshire MP Simon Hart to discuss the VAT issue, over which Mr Hart said there had been ‘strong feeling’ in both counties.
The changes would have ‘major consequences’ for the tourism industry if they are implemented, he has acknowledged in a letter to local operators, and is among MPs who have signed an amendment calling on the government to drop the VAT proposal.
Preseli Pembrokeshire MP Stephen Crabb said that although he felt it was right that the Treasury looks at all tax loop-holes, he did not want to see any harm done to the local tourism industry.
He added: “I am in close touch with several local caravan park owners and I have asked Treasury ministers to look carefully at the evidence from this part of the industry before making any changes to how static caravans are taxed.”
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