George Osborne, chancellor of the Exchequer, has "missed an opportunity" to increase the competitiveness of the UK hospitality and tourism sector, following this year's Budget.

The British Hospitality Association (BHA) was among leaders from across the hospitality and attractions industry that had urged Osborne to reduce VAT on tourism firms.

However, Budget 2012 failed to deliver any such reduction and the BHA said the move now leaves the UK with one of the highest VAT rates on hotel accommodation in Europe.

BHA deputy chief executive Martin Couchman said: "If the Budget achieves the chancellor's aim to get Britain moving, then this is to be welcomed.

"But tourism and hospitality could make a much bigger contribution to this objective if he had listened to our arguments on the reduction of VAT."

Couchman did welcome some of the measures announced by Osborne, which includes a cut in corporation tax and simplified tax returns for small firms such as guest houses.

InterContinental Hotels Group (IHG) also raised concerns that the government has not done enough to support tourism, with Air Passenger Duty (APD) still due to increase next month.

IHG UK and Ireland managing director Stephen McCall said: "With one of the highest rates of VAT on hotel accommodation in Europe, increasing APD and hard-to-obtain visitor visas, the UK shows an open for business sign but in practice the lights are off."

The Board of Airline Representatives in the UK said increasing APD and failing to provide greater airport capacity was a "recipe for failure".

- For the sport and recreation sector, the government is to make "limited amendments" to the Community Amateur Sports Club scheme as part of the Finance Bill, which is being introduced to Parliament shortly.

HM Revenue and Customs will also revise its approach to calculating endorsement income taxation to be paid by non-resident athletes, which aims to ensure the UK continues to attract world-class sporting events.

- Meanwhile, Business in Sport and Leisure (BISL) has criticised a decision to set the higher rate of Machines Games Duty at 20 per cent and said the rate would not be revenue-neutral.

BISL chief executive officer Simon Johnson said: "Instead of looking at how the industry can help the economy grow, politicians have looked at how the industry can help tackle the government's deficit problem."

BACTA, the organisation which represents the UK amusement industry, and the Association of British Bookmakers are also among the bodies to criticise the Machines Games Duty hike.

Elsewhere, the Budget 2012 confirmed the government's intention to maintain the beer duty escalator. Christie + Co said the move was a "kick in the teeth" for the UK pub industry.

The British Beer and Pub Association said 5,000 job losses and hundreds of pub closures could now be expected this year as a result of the escalator remaining in place.

- In reaction to the overall aim of Osborne's Budget to promote economic growth while also reducing the public deficit, Fitness Industry Association CEO Dave Stalker said the health and fitness sector would continue to seek new ways to remain competitive.

Stalker said: "The fact that the sector continues to grow despite the reductions in dispensable income is testament to the importance of health and wellbeing to the UK."

Mark Sheehan, managing director of Coffer Corporate Leisure, added: "In common with other businesses reliant on consumer spending and confidence we should see a gradual benefit as consumer confidence returns slowly."

Details: www.hm-treasury.gov.uk

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