Tuesday, 13 October 2020
Financial Resolution No. 3: Value Added Tax
We are closing the stable door after the horse has bolted. I acknowledged the value of the original VAT cut when it was introduced by the then Ministers, Michael Noonan and Deputy Howlin, but when the rate was increased again it should only have been increased by 1% or 2% rather than going all the way back up to 13.5%. This resolution is giving a VAT reduction to businesses that are closed. They have been forced to close by the State. It is obviously a panicked, knee-jerk reaction but it should have been done six months ago. The rate should have been reduced to 5% as it was throughout Europe. That would have helped businesses to get up off their knees and get their doors open again. We are playing Tweedledum and Tweedledee and are playing mind games with businesses. How are businesses to reclaim the VAT now? I also hope that beauty salons will be treated the same as hairdressers, as well as the plethora of other service industries involved in weddings and so forth including hotels, musicians and so on. This is too little, too late and the rate should be dropped to 5%.