Martin Conway (Fine Gael) | Oireachtas source

I congratulate the Minister on what was an excellent budget and on being candid and blunt with the Irish Hotels Federation about its members' price gouging when he met its representatives. I would love to know if something can be done, from a legislative perspective, to try to prevent this type of thing happening. I do not know how you could go about it but it is totally unfair to the thousands of people all over the country who are struggling to run businesses.

It was put simply to me by a man who established a new business recently. He will probably have turnover of €2 million to €3 million but that does not mean he will have anything significant in profit. As he said, for each €1 million the difference between 9% and 13.5% is €45,000, which is substantial. As has been stated already, there is a major struggle to try to keep businesses open as a result of staff shortages and so on. Some businesses in Ennis are looking at staying closed on Mondays and Tuesdays because they cannot get staff. The 9% rate going to 13.5% will have an impact on them.

During Covid we looked at changing and altering rules. I understand that VAT is controlled to a large extent by criteria in Brussels but surely we could look at regionalising it so that in areas that are heavily dependent on tourism but do not have the traffic of the capital cities, including winter traffic as well as summer traffic, we could look at retaining the 9%. I know the answer will be "No" but surely we can go back to engage and see if there is a way of doing it. There could be a 13.5% VAT rate in the areas with substantial resources and where price gouging and so on is continuing, but the 9% rate could apply in other areas that need it and that are trying to generate a regional balance of people living and working in our smaller areas such as County Clare, as opposed to the capital, to try to balance out our population. I am asking the Minister to think outside the box and make the case to Brussels to have another look at how we implement the VAT rules.