French Cut VAT to Attract Holidaymakers
French tourism could be on the end of a welcome revival from the British market as large VAT cuts from the French government should help ease concerns over the poor exchange rate.
The pound has rallied slightly in the past few months against the euro, but at today’s exchange rates still sits at a rather dismal €1.17 to the pound. From 1 July 2009, new VAT measures in restaurants and cafés will see the tax reduced from 19.6 per cent to just 5.5 per cent.
Although not all restaurants will pass on the savings to customers, the cut in VAT should make eating out on holiday significantly cheaper for tourists. The accommodation and hotel provider P&V estimates that the 14.1 per cent tax cut would convert to a 10 per cent saving for customers on food and drink.
Tourists taking a flight to Paris, for example for their summer holidays will be able to save €7 (£6) on a meal for two eating out at one of the capital’s many fine dining experiences. Similarly a cup of coffee from a café is likely to be 40 pence cheaper as a result of the reduction in VAT.
Whilst the sun holidays this summer will benefit from cheaper victuals, the real hope is that the tax cut will help to re-energise the ski market at the major French resorts in the Alps. Top resorts such as Courchevel and Meribel in the Three Valleys were hit last season by a depreciated British market, and were criticised for over-inflated prices on the mountain.
Hotel manager Nicolas Rochedy told TravelMole.com: “Although some products are exempt from the cut, such as alcohol, the majority of our most popular dishes will be reduced for the customer. Skiers will therefore notice that their lunchtime meal, bottled water and a cup of coffee will be largely reduced from last year’s prices.”
Holidays News posted by Albert Reeves on 30 June 2009
France, holiday, VAT, tax cut, cheap hotels. skiing, Courchevel
http://www.travelmole.com/stories/1137118.php
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