Paul Lenehan, president of the Restaurants Association of Ireland (RAI), has released an “urgent message” to the government, encouraging it to do the “right thing” for local restaurants and cafes.
Meanwhile, the RAI issued a statement yesterday, warning that the next few weeks are going to determine the future of the food-led hospitality industry.
‘Avalanche Of Closures’ VAT
‘The Government can choose to listen to restaurant and café owners who have pleaded with senior ministers in recent weeks to reinstate the 9% VAT rate, allow for warehoused debt repayments to be phased over ten years, and introduce targeted support for those businesses in our low-margin, labour-intensive [industry] that need it most,’ read the statement on LinkedIn.
‘Or, alternatively, it can continue down the path it is currently on: refusing to afford small, independent restaurants and cafés across the country a viable future through the reinstatement of the 9% VAT rate, and continuing to insist that €257 million of untargeted grant aid support capped at €5,000 per business will be enough to avoid an avalanche of restaurant and café closures despite constant warnings that it will not.’
‘VAT Nine’
Lenehan has also released a video message asking the government to consider a return to the 9% VAT rate, which he described as the “only show in town”, to avoid a “tsunami of closures” across the country.
Lenehan further added that “VAT Nine” is the only thing that will save and stop the closures.
‘Not Viable’
“The rising costs we are incurring through wage inflation, food costs, energy costs are out of control, and everything, including the 4.5% added to the VAT rate in the last Budget, has made our businesses completely unviable,” said Lenehan.
“Our cash flow is at an all-time low. Our VAT returns made only for November and December have proved that to everybody. Our businesses are simply not viable.”
