A Peterlee pub is to cut the price of all food and drink by 7.5 per cent on Thursday, September 24.
The Five Quarter in Hailsham Place is supporting Tax Equality Day, aimed at highlighting the benefit of a permanent VAT reduction in the hospitality industry.
The prices at the Wetherspoon pub will be reduced for one day only.
At present all food and drink in pubs is subject to five percent VAT as a result of the VAT cut by the Chancellor on 15 July.
However, this is only set to continue until 12 January 2021, when it will return to 20 per cent.
By comparison supermarkets benefit from a zero VAT rate on all food.
As a result, supermarkets are able to use that saving to sell alcohol at a discounted price.
The pub’s manager, Mel Gallagher, said: “We are proud to support the campaign to reduce the level of VAT within the hospitality industry.
“Customers coming to The Five Quarter on Thursday September 24 will find the price of their food and drink is lower than normal. Pubs have been under fantastic pressure for decades due to the tax disadvantages we have with the supermarkets.
“We’re very grateful to the Chancellor for reducing the tax disparity between supermarkets and pubs to five per cent.
“We are urging the Chancellor to create tax equality between pubs and supermarkets by making the current VAT regime for pub food and soft drinks permanent.”