Derek Nolan (Galway West, Labour) | Oireachtas source

There is a great deal in what the Minister said about the economic analyses, but all the analyses stated that jobs were created. I believe that is true. With the 9% rate we have created a stimulus for a sector that was doing very poorly and have created, as a result, a far more attractive tourism sector which is attracting people into the country because of our cost base. If the 9% rate created jobs, the corollary is that increasing the 9% rate will cost jobs. That is what the opposite of what is said in the studies means. We cannot exclude that.

Among the businesses I talked to in Galway yesterday, a major employer in the city told me that with rates, insurance and water as fixed costs, the only way he could pass on the increased rate would be through losing jobs. The increase in numbers has meant that he is paying more VAT due to the lower rate than he was when the higher rate was in place. It is generating business and he is paying more VAT. We must be very careful before we act on this. Certainly, a slashed increase from 9% to 13.5% would have a devastating impact on this sector.

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