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Starbucks and McDonald's also say they will cut prices after the chancellor 's VAT reduction.
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Scooped by Graham Watson |
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The Chancellor's Summer Statement offered restaurants a temporary VAT cut from 20% to 5%, and a number of leading chains - KFC, Nandos and Pret - have agreed to lower prices.
However, it's easy for large chains with substantial cash reserves to pass on VAT. Smaller chains aren't necessarily passing on the cut, but using it to shore up their finances.
It's interesting to see the distributional consequences of this - is the temporary VAT cut designed to support businesses or increase consumer demand. Or both.