Curry crisis: restaurant leaders call for cut in VAT
PUBLISHED: 13:00 04 September 2012 | UPDATED: 17:22 04 September 2012
Restaurants along the famous Brick Lane 'Curry Mile' in London's East End face closing down because of VAT now hitting 20 per cent.
They are among 10,000 curry houses in Britain struggling with a 40 per cent drop in trade this year and the taxman taking £1 for every £5 diners spend.
Now leaders of the £3.6 billion-a-year curry industry are calling on the government to act before more businesses under.
They have written to Prime Minister David Cameron and Chancellor George Osborne urging a cut in VAT.
The prestigious two-storey Café Naz in Brick Lane has a notice advertising “restaurant lease for sale.”
Trading has already ceased on the ground floor which only a year ago would be packed with diners—just the upper floor is currently in use.
Owner Muqim Ahmed had put the business up for sale. He is keeping the property freehold, but wants to offload the restaurant and is looking for a buyer.
“I’ve put the Naz on the market—but no-one has the money to take it over,” Muqim told the Advertiser. “The curry trade is on its knees.
“Brick Lane is finished. My staff don’t want me top sell it—but it is for sale. The industry is not making money.”
His rival Azmal Hussain, who runs nearby Preem & Prithi, says he was offered the business, but “can’t afford to run it.”
Azmal explained: “There isn’t the trade to cover the rent and high business rates—it would have to make £15,000 minimum a week just to clear.”
He is vice chair of the Brick Lane Restaurateurs Association which is backing the call for a reduction in VAT he says is crippling the trade.
One restaurant has already closed in Brick Lane. A notice hangs in the window of Dawaar curry house with a warning from a firm of bailiffs not to enter the premises now under its “care and protection.”
Opposite, Odud Choudhury, 43, fears his Saffron curry house could be next to go.
“We are in danger of closing down,” he told the Advertiser. “I give it three months, perhaps.
“I had to lay off staff—it was a blow. We’ve had an awful time since VAT went up and it’s getting worse.”
Opposite, Chillies’ owner Shah Ali is also thinking of quitting after cutting back his workforce.
He said: “I will sell the restaurant if things don’t pick up. Increasing VAT hasn’t helped.”
British Curry Awards founder Enam Ali, Chairman of the Guild of Bangladeshi Restaurateurs, believes a small reduction in VAT could make all the difference.
“Many restaurants won’t be around when we hold the Curry awards next year,” Mr Ali warned. “Some have already fallen by the wayside.”
Brick Lane traders were assured of an influx of visitors during last month’s Olympics—which never materialised.