The submission on the record
UKHospitality has placed a single mechanism at the front of its Budget submission on employment costs. The trade body wants the employer National Insurance threshold raised progressively to £10,000 by the end of the Parliament. It set the ask out on 8 October, ahead of the Budget on Wednesday 28 October.
The measurement behind the ask
The case rests on the body’s own analysis of Office for National Statistics data. On that reading, hospitality accounts for 31 per cent of all first jobs for people aged 16 to 24 and employs 18.2 per cent of all young people in work. The sector takes on around 300,000 people in that age band each year.
UKHospitality publishes those figures as its own analysis of the ONS data.
The employment cost line
Two cost numbers carry the submission. UKHospitality records hospitality businesses paying the equivalent of 82 per cent of pre-tax profits in business taxes, and the sector absorbing more than £5bn in additional costs over the past two years.
The body accounts 100,000 hospitality jobs lost across the same window, which it puts at 45 per cent of all roles lost across the UK economy.
British Retail Consortium analysis carried out by Flint Global gives the same reading on the tax burden. Hospitality pays 82p in business taxes for every £1 of pre-tax profit, retail pays 72p, the eleven-sector average is 50p and banking pays 40.5p. Hospitality’s tax burden was £22.9 billion in 2025/26.
The threshold and its history
Rachel Reeves cut the employer secondary threshold from £9,100 a year to £5,000 in the 2024 Budget. UKHospitality records 774,000 hospitality workers drawn into the lower threshold and a 10 per cent rise in the cost of employment per person.
The body pressed the point in Parliament. It laid an amendment seeking a delay in implementation until a full impact assessment had been carried out.
The four measures the ask sits inside
UKHospitality published its full Budget position on 9 September. The measures are a cut in VAT for hospitality to 10 per cent, a fix for business rates, a reduction in employer NICs, and the replacement of the holiday tax with a tourism bonus.
Simpson on the record
Allen Simpson, chief executive of UKHospitality, put the sector as the nation’s biggest creator of jobs for young people and the annual figure at around 300,000 roles. “That job creation superpower has been put in jeopardy over the past two years, with hospitality hit by more than £5bn in extra costs,” he said.
“Without action, our already-stretched ability to provide those job starts for young people will be put at risk,” he said, and he asked for the cost of employment to come down so the sector can hire and help address the Neets crisis.
The decision date
The ask is a submission and not a decision. The decision sits with the Chancellor at the Budget on Wednesday 28 October.