A North Clare Restaurant owner claims businesses in the hospitality sector would be pricing themselves out of the market, if they continued to pass price rises onto customers.
It follows the announcement this week that the 9% VAT rate for the sector is being extended for another nine months.
Businesses here are amongst those calling for a further extension of the lower rate until the end of next year.
The 9% VAT rate for the hospitality sector was introduced as a Covid measure and was due to rise to 12.5% in August, but in a move welcomed by the industry, the Government this week announced the lower rate has been extended until February 28th, 2023.
The move, which is geared towards helping businesses, including cinemas, theatres and museums cope with rising costs, will cost the state 250 million euro.
Businesses here are among those in the industry calling for the VAT rate to be extended further, however, to allow them ‘level the playing field’ after the pandemic.
The Owner of the Monks Restaurant in Ballyvaughan insists that businesses can’t recover losses of the last two years in a matter of months, while coping with inflation.
Patrick O’Donoghue says continuing to pass price rises onto customers would price them out of the market completely.
The Vice Chair of the Clare Tourism Advisory Forum says businesses are currently absorbing additional costs but he’s warning that hidden costs will need to be addressed.
Operations Manager at Durty Nelly’s in Bunratty, Maurice Walsh says the hospitality sector is in crisis at the moment.
