Donegal Deputy Thomas Pringle has appealed to Government to lower the VAT rate for the hospitality sector, which he says is “drowning”.
He made the appeal to lower the rate to 9%, after business owners from Donegal and across the country marched in Dublin yesterday calling for the change.
The 13% rate of VAT on the hospitality sector was introduced last year, and business owners say that increase has only tightened their purse-strings even further.
Some of the Donegal business owners who made the trip to Dublin yesterday. Pic – Bonnyglen Bar and Guesthouse
Deputy Pringle took to the Dail to call for the reinstatement of the 9% rate today, citing a number of recent cases in Donegal of hospitality outlets closing due to rising costs.
“I fully support and have co-signed this motion and I would particularly like to highlight the motion’s calls on the government to permanently reinstate a lower 9% VAT rate on food sales in Ireland, to recognise the critical contribution of the food service sector and prioritise the protection and sustainability of this sector.”
“There is no doubt that the food sector has faced countless pressures over the last five years, between adapting during the Covid-19 pandemic and all the requirements that came with it, and the current cost-of-living crisis we are facing as well.”
“Restaurants and cafés are feeling the pressure. They are struggling to continue trading with the rising cost of electricity, gas, food and supplies and they are forced to face the full impact of rising prices alone.”
“Many are facing potential closure and some have already been forced to close. My constituency of Donegal has seen many closures over the last few years, and it is truly devastating to see.”
“I raised this same issue two years ago when a local business in Killybegs was forced to close due to rising costs at the time, including a 50% rise in cooking oil costs, a 70% rise in beef, a 78% rise in dairy produce and a 90% rise in chicken costs.”
“It is rising costs like these that the food sector is finding difficult to recover from, and this is before adding energy bills on top of it.”
“Two years later and southwest Donegal has seen many more closures, most recently the closure of a well-loved, family-run restaurant in Ardara three days ago. The restaurant stated: ‘Unfortunately, with the difficulties facing the hospitality industry at the moment and spiralling costs, it has simply become unsustainable for us to continue.”
“The industry is drowning, Minister, and your government needs to recognise this and do something about it before it’s too late.”
“And really, it is already too late for so many businesses. I am particularly concerned about rural towns that rely on seasonal work, like Killybegs, where most of the employment in the area is seasonal.”
“Killybegs relies on the food sector for seasonal employment due to the fact that the fishing sector only provides seasonal employment as well. And the fishing season is getting shorter and shorter each year due to a continuous decrease in fishing quotas.”
“The sector has the potential to grow if there is a bit of support there. They’re not looking for massive hand-outs, and many places can develop and will develop with a bit of support and that’s the key to it.”
“The food sector is severely struggling in the cities too. I have talked to business owners in Letterkenny who are also struggling to make ends meet and dread the ever-increasing bills.”
“This is not the way it should be. People shouldn’t be living their lives under this much stress, especially when they play such a vital part in our towns and cities.”
