3 minute read
Extra tax off the menu
9% VAT RATE FOR THE HOSPITALITY SECTOR TO BE RETAINED THROUGHOUT SUMMER MONTHS
After much toing and froing, the government finally signed off on another extension to the lowered VAT rate of 9% in its latest cost-of-living package. The news that the entire industry will continue to benefit from the 9% rate until the end of August has been universally welcomed. The government has been adamant that this will be the last extension and that the rate will increase at the end of the summer. That’s despite the fact that at 13.5%, Irish consumers will be paying the second highest tax rate in the EU for dining out and staying in hotels.
Commenting on the move, the Licensed Vintners Association (LVA) said that it is “positive that the government has kept the extra tax on consumers off the menu” by pushing back the VAT increase on hospitality until after the summer season. It also warmly welcomed the extension of The Business Energy Support Scheme (TBESS) and the commitment to simplify the application process. “We are glad that sense has seen out and that the VAT rate for hospitality will not be changing until after the summer. While we would have preferred to have seen this measure postponed for 2023, it is positive that the government has kept the extra tax on consumers off the menu for now. In our view, it made no sense for the government to be pushing up prices while there are such cost of living challenges in this country. It would have also been shortsighted to introduce extra taxes just at the beginning of the tourism season. Everyone in the hospitality industry will be breathing a sigh of relief with this news,” said Donall O’Keeffe, CEO of the LVA.
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TBESS THRESHOLD QUALIFICATION IN UTILITY COSTS DOWN COMPARED TO THE SAME PERIOD LAST YEAR
The coming six months are vital for the pub trade, with the St Patrick’s weekend seen as the traditional start of the tourist season and on into summer, said Paul Clancy, Chief Executive at the Vintners Federation of Ireland (VFI). “Maintaining the 9% VAT rate will assist those businesses serving food and bring an element of confidence. However, we are in a situation where the problems an increase in VAT will bring, namely pub closures and job losses, will re-emerge later this year once the extension lapses. Our message to government will remain the same – the hospitality sector needs VAT at 9% until 2026 when tourist numbers are expected to return to pre-pandemic levels.”
The VFI Chief Executive says the expansion of the Temporary Business Energy Support Scheme (TBESS) is welcome. “Since TBESS was announced during Budget 2023, the VFI has lobbied on behalf of the significant number of our members who were omitted from the scheme because they are not connected to the natural gas network, so the announcement that pubs using LPG and kerosene can now apply is a big boost for businesses facing massive energy costs. We recognise that Government is offering considerable support to our sector at this time but the external pressures on our members is unprecedented and will continue for the foreseeable future.”
RELIEF
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TBESS – how it’s set to change
» The threshold for qualification will be cut from the current 50% increase in electricity or gas costs compared to the same period a year ago, to a 30% increase. These changes will apply retrospectively from the start of last September
» The level of relief is set to increase from 40% to 50% of eligible costs from March 1st
» The payment will remain subject to a monthly limit, but will also rise from the current €10,000 to €15,000 per month per trade or profession from next month
» Payment will be subject to an overall cap of €45,000, up from €30,000 where the business is carried on from more than one location
» Government is also looking at introducing a new grant to help businesses that use LPG, kerosene or fuels other than natural gas or electricity.
As the oldest licensed distillery of its kind, the Kilbeggan Distilling Company has occupied the same spot on the River Brosna in the humble town of Kilbeggan since 1757. For 200 years, it was an unlikely success story, as a dot on a map managed to produce a whiskey beloved the world over. But by 1953, tough times had ground its gears to a halt. The doors were deadbolted and the building was auctioned o . When the doors of the Kilbeggan Distillery were shut in 1953, the people of Kilbeggan could’ve easily accepted defeat. They could’ve acknowledged that times had changed and that fate had dealt them more than their share of bad breaks. They would do no such thing. The distillery meant too much to too many in the town. They would never let its smokestack be reduced to a monument, no matter what the world threw at them.
They couldn’t buy back the building, so the townspeople bought time, by paying the distillery license year after year. After three decades of paying and waiting, they received the key to the building and set out to restore it to its former glory. It took long nights and sacrificed weekends, but the town came together and the distillery came roaring