Governments 4% increase in VAT for restaurants "will close doors" say Restaurants Association

The Restaurants Association of Ireland has described the move by the Government to increase the 9% vat rate to 13% as of midnight tonight as nonsensical and will close the doors on many low margin restaurants, cafes and food led pubs across the state. The news comes not long after the Leinster Leader shared a report on the Kildare figures of pub and restaurant closures in recent years.

The Chief Executive of the Restaurants Association of Ireland has said, “The increase is wrong at a time when the country needs to reduce inflation, a vat increase only adds to inflation. Government need to restore the  9% Vat for Food related Hospitality businesses in Budget 2024 and we will me making the case for this when we meet with the Minister for Finance next week. The increase the vat rate is the final nail in the coffin for many small cafes, restaurants and food led pubs.”

The move will add to consumer inflation despite arriving at a time when Government has said it wouldn’t add to the cost of living. The VAT increase will move Ireland to the second highest hospitality vat rate within the EU.