A major hotel in Dublin, charging exorbitant rates for rooms, cannot and should not be compared to a small cafe in West Cork
Hospitality should be split between accommodation and food with a 9% VAT rate applying to food and beverages, according to Social Democrats leader Holly Cairns.
Deputy Cairns said:
“Small hospitality businesses are the backbone of so many of our cities, towns and villages. Regrettably, many of those businesses are now facing closure – with hugely negative impacts on staff, suppliers and the wider community.
“This is a particularly serious issue in rural areas where small cafes and restaurants are the lifeblood of local economies.
“A major hotel in Dublin, charging exorbitant rates for rooms, cannot and should not be compared to a small cafe in West Cork.
“For that reason, the Social Democrats would split food and accommodation businesses, for the purposes of VAT, and apply a reduced 9% VAT rate on food and beverages.
“VAT is a blunt instrument, but this is an emergency measure, designed to get support to businesses quickly, and is necessary to stop the closure of otherwise viable businesses.
“In government, we would also, as a matter of urgency, conduct, a review of supports to the sector because so much of what the government has provided has either been ineffective or overly complicated, to the point they become inaccessible and functionally useless.
“We know that many businesses were unable to access the Temporary Business Energy Support Scheme (TBESS), with only a tiny fraction of the overall allocation being drawn down. Meanwhile, despite the National Training Fund having a surplus of €1.3 billion, ISME’s training budget under the fund was actually reduced this year.
“The reality is the outgoing government has been unable to target supports at businesses in an accessible and efficient manner.
“Election promises coming from some coalition partners now, pledging belated support to small businesses, are too little and too late.”