A GREENOCK pub is set to cut the price of its food and soft drinks next week to highlight the benefit of a permanent VAT reduction in the hospitality sector.

The James Watt on Cathcart Street will mark Tax Equality Day on September 12 by reducing prices on some products by 7.5 per cent.

All food and drinks in pubs is currently subject to 20 per cent VAT, whereas supermarkets do not have to pay any VAT on food products.

The Wetherspoons pub’s manager Neil Clark said: “Pubs have been under fantastic pressure for decades due to the tax disadvantages it has with supermarkets.

"The tax benefit allows supermarkets to subsidise the selling price of beer.

"It doesn't make sense for the hospitality industry to subsidise supermarkets.

"We urge the Chancellor to create tax equality between pubs and supermarkets."