Demand to cut VAT for Northern Irish businesses as Republic of Ireland rate falls

​The lobby group Hospitality Ulster made the comments after it was reported that the VAT rate for hospitality businesses in the Republic is to fall from 13.5% to 9%.

In the UK, the VAT rate is 20%.

Colin Neill, the chief executive of 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.”

He said that “Northern Ireland businesses are operating at a significant disadvantage compared to their southern counterparts”, and that “the UK government must recognise Northern Ireland as a special case and act immediately to even the playing field on the island”.

Meanwhile, the DUP has said the results of a recent survey have shown that businesses in Northern Ireland “are being taxed to death”.

Phillip Brett, chairman of the economy committee at Stormont, cited the results of the Northern Ireland Chamber’s quarterly economic survey about the recent Budget.

This, the North Belfast MLA said, saw “81% of respondents stating that the Budget will negatively impact the NI economy and 79% of respondents believing the Budget will negatively impact their business”.