Fish and Chip shop owners call for VAT reform after temporary closure

The owners of a popular fish and chip shop are calling for urgent reform to the VAT system, after being forced to temporarily close their business to avoid exceeding the VAT threshold.

Katy and Russell Waite, who run The Village Chip Shop in Cubert, say they have had to shut their doors for the first two weeks of April, including part of the busy Easter holiday period, due to financial pressures created by the current VAT system.

At present, the business is part of the VAT Flat Rate Scheme and pays 12.5% VAT on its takings. However, if they go over the VAT threshold, they would be moved to the standard rate and required to charge 20% VAT on bills -  with no ability to reverse that change if sales were to fall.

In a notice to customers, they explained:
"Due to frustrating VAT reasons, we are making the difficult decision to close the chip shop for a couple of weeks in early April. If we don’t, the financial implications for us will be unaffordable."

The couple said they want to remain open all year round and not be forced into seasonal trading:
"We are determined not to be a seasonal business; our local following means the world to us and we believe the people of Cornwall deserve to have chip shops, cafés, and pubs open year-round."

They say outdated tax thresholds are putting small, independent businesses under increasing pressure:
"Outdated VAT thresholds that don’t reflect inflation are making it increasingly hard for small businesses. We and many other small businesses are facing substantial increases in operating costs, yet VAT thresholds barely move. We believe the system is unfair and needs attention."

The statement adds that the issue has been raised with local MPs, with one seeking permission to escalate the matter to the relevant government minister.

Katy says the shop will reopen on Tuesday 15th April. In the meantime, she wanted to be transparent with the public about the closure:
"We decided to be honest about why we are closing, particularly as the season is kicking off, rather than be vague, as we know it seems strange. We cannot risk entering another VAT threshold that we don’t believe we can sustain."

The Village Chip Shop in Cubert is due to reopen on Tuesday 15th April - in time for the traditional Good Friday Fish and Chips.

PRESS PLAY to hear our conversation with Kary from the Village Chip Shop in Cubert.