Representatives of the Irish hospitality industry have expressed disappointment with the scale of the supports for the sector announced in Budget 2025 and the Government’s decision to retain the higher rate of VAT for the sector.
On Tuesday, Minister for Finance Jack Chambers and Minister for Public Expenditure Paschal Donohoe outlined a series of measures aimed at providing relief for businesses struggling with rising costs.
The Government declined to reduce the VAT rate for the hospitality sector from 13 per cent to 9 per cent. Excise duty on alcohol, meanwhile, will remain unchanged.
Michael Magner, president of the Irish Hotels Federation (IHF), expressed “deep disappointment” with the announcements, claiming Budget 2025 has failed to arrest a “commercial crisis” facing the food-led hospitality sector.
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In a statement, he said: “The decision not to reduce the hospitality VAT rate is short-sighted and extremely concerning given the stark commercial environment that food service businesses are operating under throughout the country.”
Mr Magner said Government policy is now “fundamentally at odds” with the interests of hospitality and tourism in Ireland.
The Vintners Federation of Ireland, meanwhile, said Budget 2025 falls “disastrously short” of what is needed to protect and “industry on the brink”.
VFI chief executive Pat Crotty said: “The budget is a disaster for our sector. We have been clear with the Government about the immense pressure pubs are under, yet they have failed to deliver any meaningful support.”
Publicans needed the VAT reduction “to survive”, he said. “What’s worse, the minor supports Government is offering are nearly useless when you consider the soaring cost of doing business. Pubs are already closing their doors, and this budget will accelerate that trend.”
More to follow ...
