Hairdressing and beauty industry on the brink: Nottinghamshire business owners plea for VAT cuts
Colette Osborne, a determined entrepreneur from Nottinghamshire, stands as a pillar of resilience in the local hair and beauty sector. With her two thriving salons under her belt, she employs 42 dedicated professionals and nurtures the dreams of 7 ambitious apprentices. But despite her success, Osborne finds herself sending an urgent plea to the government, a cry for help that reflects the desperation of an entire industry on the brink of collapse.
Mr Osborne’s appeal centers around one seemingly innocuous but important demand: to reduce the barber and beauty industry’s VAT from the current 20% to a more manageable 10%. The consequences of inaction will be dire, she warns. Without this much-needed reprieve, the industry will lose jobs, retail stores, and the opportunity to train the next generation of hairstylists.
harsh reality
The seriousness of the situation was highlighted in a recent poll of 600 UK hairdressers. More than half of the VAT paying companies surveyed admitted that they were seriously considering going out of business due to financial pressures exacerbated by the current tax system. The “rental chair” model, which allows salons to undercut his VAT threshold, further complicates matters. This model, while seemingly innocuous, enables “disguised employment” and organized crime, contributing to the industry’s downward spiral.
Mr Osborne was undeterred by the magnitude of the challenge and launched a petition to reduce VAT five months ago. Her determination brought her to the highest positions of power and gave her the opportunity to discuss the issue with her prime minister.
Slow and steady recovery: an uphill battle for the industry
The latest research from the American Federation of Barbering and Cosmetology highlights that the industry is well on its way to recovery. Currently, 40% of businesses report small or good profits, evidence of their resilience and adaptability. However, the road to recovery is fraught with obstacles. 20% of businesses are still suffering losses and the sector continues to face challenges such as inflation, high energy costs and rising labor costs.
The industry is bracing for a potential talent shortage, especially as the appetite for hiring apprentices wanes. In this situation, calls for targeted support from governments have become increasingly urgent. Ahead of the Spring Budget on March 6, the industry is calling on the government to reform VAT and provide apprenticeship incentives to stabilize and secure the industry.
wishes for the future
As the spring budget deadline approaches, Colette Osborne’s appeal resonates across the hairdressing and beauty industry. She believes that reducing VAT is not just a matter of economic relief, but a matter of survival. This calls for retaining jobs, developing talent and continuing the vibrancy of the industry that has long been the bedrock of local communities.
Faced with mounting challenges, the hairdressing and beauty industry is at a crossroads. The choices made in the upcoming spring budget are very likely to determine its future trajectory. As Colette Osborne continues her fight, her message is clear. The time to take action is now.