The Licensed Vintners’ Association (LVA) has announced plans to make the restoration of the 9% VAT rate for food an issue in the run-up to the local and European elections this summer.
The association has begun writing to all public representatives for Dublin on this issue this week, seeking their commitment for restoring the lower rate of VAT for food.
‘Simple Fact’
“The simple fact of the matter is that the government should never have increased the VAT rate for food last year,” said Donall O’Keeffe, CEO of the LVA.
“It immediately pushed the level of taxation applied to food up by 50%, and that had an instant knock-on impact on menu prices.
“The public didn’t like that, and neither did the wider hospitality sector.”
VAT Rate
The 9% VAT rate for food had been in place for ten of the last 12 years, before it was scrapped by government last September.
The LVA has noted that, for the average Dublin pub, 35% of its turnover comes from food. That figure rises to 50% of turnover for a significant number of food-focused pubs across the capital.
Local Public Representatives
The LVA noted that since the government increased the VAT rate on food last autumn, food businesses were forced to raise their menu prices.
The vintners plan to write to politicians across the capital, asking them whether they support the reinstatement of 9% VAT specifically for food, and they will be asking their members to do the same to their local public representatives.
‘Election Year’
“We hope this will help focus minds and that the government will take action on the VAT rate before more food-led businesses go to the wall,” said O’Keeffe.
“The industry is crying out for this issue to be addressed, and the politicians would be wise to reflect on that matter in an election year and with a general election also on the horizon.”
