As operators ridicule the Chancellor’s giveaway, one Kensington venue is touting a £25 “kids” menu of burgundy snails and anchovy butter toast

Pubs and restaurants are expected to dream up increasingly inventive ways to milk a tax break on meals for under-18s, after a London venue unveiled a “children’s” menu featuring wild burgundy snail salad and anchovy butter toast.

Rachel Reeves last month announced a temporary cut in VAT on children’s meals, from 20 per cent to 5 per cent, running between 25 June and 1 September. The reduction forms part of a “Great British summer savings scheme” pitched as relief for hard-pressed venues and a sweetener for families. – Business Matters has explained how the Great British summer savings scheme works here.

The Chancellor flagged the policy in a video address to last week’s UKHospitality trade conference, where it landed to a notably muted reception.

Afterwards, senior figures across the trade added their voices to a growing chorus of derision, branding the scheme “laughable” and contrasting it with the roughly £5bn in extra costs piled onto pubs, bars, hotels and restaurants since Labour returned to power in 2024.

Chris Jowsey, chief executive of the 1,300-strong pub group Admiral Taverns, called the measure a “joke”, arguing that the resulting discount was “so small it’s embarrassing” and would do nothing for pubs that do not serve food.

He likened the VAT cut to the pandemic-era rules that, at one point, effectively allowed venues to serve alcohol only if it arrived alongside a scotch egg. “I suspect you’ll get some enterprising interpretations of children’s menus,” he said.

One restaurant in Kensington, in affluent west London, has already worked out how to wring maximum value from the policy.

The Blue Stoops has launched a £25 menu aimed at any “children” with an appetite for wild burgundy snails with bacon, anchovy butter toast, and beef and oyster pie. The line-up includes a pudding christened The Tax Break Tart. A non-alcoholic beer is bundled in, meaning the entire package qualifies for the summer reduction from 20 per cent to 5 per cent.

“We’re not expecting queues of children demanding snails and anchovy toast, but it has started the right conversations in the pub about why VAT support for hospitality needs to go much further,” the venue said.

Crucially, restaurants and pubs are under no obligation to verify that anyone ordering a discounted children’s meal is in fact a minor.

Clement Ogbonnaya, who owns the Prince of Peckham in south London, dismissed the discount as a “token gesture” that would achieve little without a permanent cut to the headline rate. “We’re all going to be faking our IDs to show we’re under 18,” he joked.

At the UKHospitality conference, operators lined up behind a call to slash VAT on hospitality from 20 per cent to 10 per cent. A parliamentary petition backing the move has already gathered more than 200,000 signatures, and can be found on the UK government petitions site. The campaign is supported by celebrity chefs including Tom Kerridge and Yotam Ottolenghi, and by the potential Labour leadership contender Andy Burnham, who has thrown his weight behind a hospitality VAT cut. Estimates of the annual cost to the Treasury range from about £10.5bn to £13bn.

The case rests partly on international comparison. While the UK rate sits at 20 per cent, the European average is 12.8 per cent. France, Spain and Italy all levy 10 per cent, and Germany charges 7 per cent. UKHospitality, which is co-ordinating the campaign, argues the gap leaves British venues at a structural disadvantage.

In her video message, Reeves insisted the government was backing the industry. The reception on the conference floor suggested otherwise. The hospitality investor and former Dragons’ Den panellist Sarah Willingham told delegates that when the Chancellor described Labour as pro-growth, she “nearly spat out my water”. The chief executive of Nightcap, owner of the Dirty Martini and Piano Works chains, described the UK investment climate as a “shitshow”.

Operators, grappling with soaring energy bills in the fallout from the Iran war, have rounded on a string of Labour measures, among them the higher national minimum wage, increased national insurance contributions and changes to business rates. The squeeze is already showing in the closure data, with three pubs and restaurants now shutting every day as costs and tax rises bite.

“They say they’re doing it for workers, but what they’re doing is making it impossible to employ workers because it’s so expensive,” said Matt Francis, owner of the Planet of the Grapes wine bar chain in London. “They think all people who own a business are driving around in a Ferrari with wedges of cash in our pocket.”

Francis added that he had only just repaid a government loan taken out when he was forced to close during the pandemic. “My reward is to pay even more tax. I will never vote for them again.” Of the summer discount, he was blunt: “We’ve got to the point where it’s laughable, not funny. And there’s a big difference.”

A government spokesperson said: “Businesses across the country have welcomed the Great British summer savings scheme, which will slash VAT from 20 per cent to 5 per cent on children’s meals, cinema and theatre tickets, and family attractions this summer. This will help families enjoy days out for less while boosting footfall for businesses across the hospitality and leisure sector.

“We’re also backing hospitality by reforming business rates, including a £4.3bn support package to limit bill rises, capping corporation tax at 25 per cent, cutting red tape and taking action on the cost of living. We have the right plan to grow the economy and support families and businesses with rising costs.”

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