Tamworth Regional Council (TRC) pushed hard to find alternative solutions, but COVID-19 restrictions and a cautious hospitality industry meant the event couldn't go ahead without huge compromises.

Keystone events like Taste in the Park would have lost their flavour with restrictions still in place for large outdoor events, tasting and sampling food requirements and the need for seating, a TRC spokesman said.

"The industry, supported by the council, has been reluctant to sign up this year," he said.

"Council had reached out to restaurant, food and hospitality businesses in hopes to execute a program of external activities, however a struggling industry indicated that they are just trying to keep the doors open with limited capacities due to ongoing health restrictions."

The cancellation includes the Laneway Pop-Up Bar, Taste in the Park, the Long Lunch and High Tea.

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But, restaurants in the region will remain open serving visitors local produce, and the council welcomes the state government's Dine and Discover promotion that gives foodies $100 in vouchers to spend on dining and entertainment.

"While we won't see a Taste Festival this year, there are still many restaurants, experiences and events to enjoy in the region," TRC growth and prosperity director Jacqueline O'Neill said.

Tamworth Business Chamber board member Jye Segboer said it was a shame the event can't go ahead, but he is hopeful for the hospitality industry's recovery.

"Taste Tamworth Festival brings together a range of suppliers, hospitality businesses and the council, unfortunately during these times, restrictions and a cautious approach from the industry means that this fantastic event can't go ahead this year," he said.

"We have been a regular supporter and participant of the Taste Tamworth Festival and are looking forward to being a part of it next year.""

The festival was planned for April 14 to 18.