On 15 Jul, the Government cut VAT to 5% for the hospitality sector including restaurants, cafes and pubs till 12 Jan 2021. This has led to many big chains such as KFC, McDonald’s, Costa, and Nando’s slashing prices – so we’ve canvassed 21 big eateries, coffee shops and pubs to see where you’ll save, and if so, by how much.
VAT is a tax on businesses which is normally added to the price, so they don’t have to pass the saving onto customers, it’s completely up to each outlet – and of course, if you’re not happy with any outlet that isn’t, you’ve the choice to go elsewhere.
While most of the major chains we’ve contacted are reducing menu prices, not all are passing on the full VAT discount – which maths fans will have worked out is 12.5% off. Some aren’t cutting prices at all, including Toby Carvery and TGI Fridays, which are using the VAT saving to help towards operational costs instead, while others are still considering it. Even where outlets have reduced prices, it’s not always as simple as getting 12.5% off.
The table below shows 21 big-name outlets and what discount they’re giving, if any. Use the figures as a ready reckoner, but do check menu prices yourself as it’s likely restaurants will round up the prices rather than charging odd amounts.
| Outlet | Will a discount be applied? | When? | Full discount info |
 Burger King | Waiting to hear back | N/A | We’ve asked Burger King but it’s yet to get back to us, however The Timesnewspaper has reported there have been no cuts to Burger King’s prices. |
Caffé Nero | Waiting to hear back | N/A | We’ve asked Caffé Nero but it’s yet to get back to us. |
 Costa Coffee | Yes, 12.5% | Already happening | Full 12.5% VAT reduction on all food and drink.Includes Costa Express machines, eg, regular-size hot drink from a Costa Express is now £2.10 (was £2.40). |
 Domino’s | Yes, about 8% | Already happening | Introduced a range of local deals throughout the UK which vary depending on location, eg, collection personal pizza now £3.69 (was £3.99), ‘family football feast’ deal now £22.99 (was £24.99) etc Domino’s operates a franchise model so there’s a risk prices may differ from what its press office has given us. Check prices online before heading out. |
 Frankie & Benny’s | Yes | From Mon 27 Jul | It’s reviewing ‘all menu pricing’ and will implement reductions when it reopens 35 restaurants on Monday. |
 Greggs | Yes, 12.5% | Already happening | Full 12.5% VAT reduction on hot food and drinks. Excludes products that aren’t kept heated. |
 KFC | Yes, about 7% | Already happening | Discounting selected items, including £1 off all sharing buckets and 50p off several popular meals, eg, ‘boneless banquet’ box meal, ‘mighty bucket for one’, ‘boneless dips’ meal (four piece) and the ‘Colonel’s meal for one’ (four piece). |
 Harvester | No | N/A | Harvester says it is using the VAT saving to help ‘protect jobs which may have otherwise been lost’. |
The Ivy | Waiting to hear back | N/A | We’ve asked The Ivy but it’s yet to get back to us. |
 McDonald’s | Yes, 6%-29% | Already happening | Discounting selected items, eg, a single Sausage & Egg McMuffin now £2.19 (was £2.49), Happy Meal now £2.49 (was £2.99) and a medium Big Mac meal now £4.59 (was £4.99) McDonald’s operates a franchise model so there’s a risk local prices may differ from what its press office has given us. Check the McDonald’s app for prices at your nearest restaurant. |
 Nando’s | Yes, 12.5% | Already happening | Full 12.5% VAT reduction on all food and drink, excluding alcohol. |
 Pizza Hut | It’s still considering | N/A | Pizza Hut has told us it is likely to be passing on the discount to its customers in its restaurants and for delivery but hasn’t yet announced details. |
Pizza Express | Waiting to hear back | N/A | We’ve asked Pizza Express and it’s yet to get back to us, however The Sun is reporting that Pizza Express is ‘considering it’. |
Pret | Yes, 12.5% | Already happening | Full 12.5% VAT reduction on all hot food and hot drinks. Cold drinks are included when dining in but not on takeaway. |
Starbucks | Yes | Already happening | Discounted espresso-based beverages by 45p, no matter what size, eat-in and takeaway. Prices are reflected in-store, via the Starbucks App, and on Uber Eats. Starbucks operates a part-franchise model so there’s a risk that local prices may differ to what its press office has given us. |
Toby Carvery | No | N/A | Toby Carvery says the VAT reduction will prevent ‘the need for any imminent price increases to cover the higher costs of operating a Covid secure business’. |
TGI Fridays | No | N/A | TGI Fridays says the VAT reduction will allow it ‘to recover from forced closures and operate under new social distancing measures’. |
Wagamama | Waiting to hear back | N/A | We’ve asked Wagamama but it’s yet to get back to us |
Wahaca | Yes, 12.5% | Already happening | Full 12.5% VAT reduction on food and drink, excluding alcohol. Eg, a fish taco dish now £6.10 (was £6.95). |
Wetherspoon | Yes | Already happening | Discounting selected items, including real ale, coffee, soft drinks, breakfasts, burgers and pizzas. Eg, pint of Ruddles bitter now £1.29 (was £1.79), Lavazza coffee now £1.29 (was £1.45), burger and soft drink from £4.99 (was from £5.65). |
Young’s Pubs | Yes, 12.5% | Already happening | Full 12.5% VAT reduction on food, soft drinks & coffee. Excludes alcohol. |
Full discount info is based on information given to us by the outlet’s press office and could be subject to change
Will the recent VAT cut encourage you to go to restaurants, cafes or pubs more? Do you think all chains should be passing on the saving to customers? Let me know your thoughts in the comments below, or on Twitter @MSE_Deals.
SOURCE: Money Saving Expert