Irish Restaurants Call For 9% Vat Rate, After 'Horrendous Summer'

By Robert McHugh
Irish Restaurants Call For 9% Vat Rate, After 'Horrendous Summer'

The Restaurants Association of Ireland (RAI) believes that Ireland should retain the hospitality sector's reduced VAT rate but only for food-related businesses.

The chief executive of the association, Adrian Cummins has warned that many food-related businesses will cease trading if the reduced rate of 9% is reverted,  as planned,  to the standard 13.5% next month.

'Horrendous Summer'

Cummins said poor weather and rising energy and ingredient costs, were among the reasons why restaurateurs feel their businesses have struggled this summer.

"We’re not doing really well [this summer], I think every restaurant owner or business owner involved in hospitality or food-related businesses this summer are saying quite clearly to us - it’s a horrendous summer," Mr Cummins told RTÉ’s Drivetime.

Cummins argued that restaurants are low-margin businesses, and that the reduced rate should only be retained for food-related businesses, and not hotels or the rest of the hospitality sector.


'Long Tough Winter'

He noted that the rising cost of operating a business in Ireland meant that any boost to restaurants’ revenue this summer has been "negligible."

"We’re facing into a long tough winter now for us when we look at the forecasts for our industry. The horizon isn’t very good for us."

'Second Highest After Denmark'

Cummins argued that a retention of the tax rate would keep Ireland in line with other European countries, which he said is around 9% across Europe.

"If it goes up to 13.5%, it’ll put us to the second highest after Denmark - and Denmark isn’t a huge tourism destination - and Ireland is hugely dependent on tourism," Cummins told RTÉ’s Drivetime.