Industry urged to unite against red tape and taxation
The travel industry is being urged to write to their MPs about how red tape and taxation is killing travel businesses, following the collapse of On Holiday Group.
Peter Davies, national sales manager at OHG has written to his local MP Stephen Twigg and Lin Homer, the chief executive of HMRC, about the company going into administration, leading to 65 job losses.
He says that TOMS VAT is only one area that the Government is killing small and medium sized businesses in the travel industry and forcing them offshore.
He added issues such as APD, ATOL and the revision of the EU Package Travel Directive have also been devastating.
Willie Stewart, director of Stewart Travel, urged travel colleagues to follow suit.
He said: "I am going to write a similar one to my MP. To all you travel people out there I encourage you to do the same. Maybe if a couple of hundred letters were sent to MPs all over the country the Government would take notice."
Steve Endacott, OHG chief executive reinforced the message that the industry needs to unite, adding that the Package Travel Directive reforms could be equally as damaging.
In his letter, Peter Davies wrote: "The failure was caused by HMRC withholding over £4.4m of disputed TOMS (Tour Operator Margin Scheme) VAT from the business. Annoyingly, just two days before my employer was forced into administration, the Supreme Court found in favour of Secret Hotels and against HMRC.
"To compound the issue even further, it has been impossible for my employer to compete with Spanish companies operating in the same sector, who retail online in the UK, as they do not have to pay VAT.
"Despite the European Union existing for amongst other things to promote and encourage free trade, the difference in the interpretation of VAT taxation between member states, does not provide a level playing field in which to trade.
"TOMS VAT is just one area in which the UK Government is killing small and medium size businesses in the travel industry and forcing businesses offshore. Issues such as APD, ATOL and the revising of the EU PackageTravel Directive have also been devastating for the sector and the UK economy as a whole.
"Would HMRC not be better spending their time and resources on pursuing multi-national companies like Google, Amazon, Vodafone and Starbucks who all retail in the UK but from within complex tax avoidance structures?"
Click here to read the full letter.
Diane
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