Laois Offaly TD says Fine Gael should be 'mortified' at VAT proposal

A Laois Offaly TD has questioned why Fine Gael left the VAT rate in the service industry unchanged in the Budget despite over 500 business closures since it was increased in September 2023.   

Independent TD Carol Nolan has strongly criticised proposals by Fine Gael to reduce the VAT rate for the hospitality sector to 11% from the current rate of 13.5% as “a recipe for division that fully exposes the party’s reputation for financial responsibility as a sham.”

“Not 48 hours into the election campaign and Fine Gael and Fianna Fail are at each other’s throats over a proposal to reduce punitive VAT costs. They should have listened to the calls I and others have been making for over the last year for the reduction of the 13.5% VAT rate to 9% across the board to rescue sinking businesses,” said Dep Nolan.

She claimed the proposal by Fine Gael would only assist certain businesses. 

“Indeed, Fine Gael’s proposal is like throwing small businesses a life-line and a cement block at the same time. It only helps some while punishing others through a likely increase in energy costs,” she said. 

According to Dep Nolan, “Budget 2025 was the time for the VAT rate reduction, but Government chose to dismiss it. That was incomprehensible to me as Government was actively aware of the reality that the number of restaurants, cafés and other food-led businesses forced to close their doors for good since the 50% hike in the hospitality sector’s VAT rate from 9 to 13.5% last September has already reached a total of at least 577.” 

She said “what we are seeing now is that there is no ‘plan’ to assist struggling businesses in Offaly in terms of VAT rate reductions. There is only off-the-top-of-the-head proposals that would moderately assist some small businesses while driving up costs for others.”

In conclusion, Dep Nolan said, “Fine Gael and indeed Fianna Fail should be mortified by this game playing nonsense.”