REACTIVE STATEMENT FROM HU ON REDUCTION OF HOSPITALITY VAT RATE IN ROI

15 January 2025

Reactive statement from Hospitality Ulster on the reduction of hospitality VAT rate to 9% in the Republic of Ireland as part of expected Programme for Government.

Colin Neill, Chief Executive, Hospitality Ulster said:

“The time for action on Northern Ireland's hospitality VAT rate has long since passed. The UK Government must stop ignoring the crisis in our industry, recognise the special circumstances under which we operate and act accordingly. The Northern Ireland Executive must represent our case to Westminster and ensure that the playing field on the island of Ireland is evened out.

"The incoming Irish Government has signalled its intent to lower the VAT rate for food-based hospitality to 9%. This means that the hospitality VAT rate disparity on the island will further increase, with Northern Ireland's rate standing at 20%.

"Hospitality is the cornerstone of our tourism offering, with the sector accounting for four in five tourism jobs. The island is marketed as one tourism destination, yet two widely disparate VAT rates will now be in operation on the island. With the possibility of the introduction of an ETA scheme on the border, Northern Ireland businesses are operating at a significant disadvantage compared to their southern counterparts. 

"The UK Government must recognise Northern Ireland as a special case and act immediately to even the playing field on the island. To have to deal with this competitive disadvantage while dealing with increased costs in the form of wage and ENIC increases is unacceptable.

“In the meantime, the NI Executive must step in and provide financial support to offset the damage done by the UK budget to protect the tourism infrastructure that is hospitality.”