Clare Restaurateurs are warning that a critical part of the county’s tourist and cultural complex will be decimated unless the coalition reinstates its commitment to cut the hospitality VAT rate.
Despite promising to do so in the Programme for Government, the Finance Minister has now poured cold water on the prospect of reducing the tax.
According to the Restaurant’s Association of Ireland, more than 200 food-led businesses have already closed this year.
Based on a survey of its over 6,000 members, the RAI says that since 2022, electricity costs have gone up 96%, fruit & vegetables by 50%, beef by 95%, chicken by 35%, while the price of chocolate has more than doubled.
Owner of Sweet N Green Café in Ennis, Frank Landy claims that due to soaring costs, he’s been left with no option but to delay investment, reduce staff hours and in some cases increase prices.
He says most eateries are now fighting for survival, not profits.
The RAI has now called for a number of measures in Budget 2026, including a €400,000 investment to create a national food tourism strategy, address public liability insurance costs and ensure minimum wage hikes are aligned with inflation.
It’s also calling for the reinstatement of the 9% hospitality VAT rate, something which the coalition had promised in the Programme for Government.
Due to financial uncertainty arising from global events, however, Finance Minister Pascal Donohoe says this can no longer be guaranteed.
According to one of Clare’s newest businesses, international tourists are remarking on the increased costs of visiting Ireland, while in turn visitors numbers from overseas have dropped by 17% this year, according to the CSO.
An Beag Café in Kilrush, which is now open 15 months, didn’t qualify for the Increased Cost of Business Grant and received no commercial rates rebate this year.
Owner, Andrew Flood claims there’s no incentives to start a new food-led outlet in the current climate and that meaningful supports along with a rebranded emphasis on tourism promotion are urgently needed.
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