Ollie Crowe (Fianna Fail) | Oireachtas source

I raise the VAT rate for the tourism and hospitality sector, which, as Senators are aware, is currently at a special rate of 9%. This special rate is due to expire on 28 February, with the rate returning to 13.5% from 1 March. Given the challenges facing these sectors as a result of spiralling costs, we must reconsider and announce the retention of the 9% VAT rate for the year ahead. The Government has always said it would keep the situation under review and that it was not firmly committed to any schedule. As I am sure my colleagues know, I speak to businesses operating in these sectors daily and weekly, especially in Galway city and county, and it has never been more challenging than it is now. Inflationary pressures have resulted in spiralling costs for the industry and many businesses are not fully passing these on to consumers for obvious reasons. It would be simply wrong for the Government to make this problem even worse.

I raised this issue with the Minister for Finance, Deputy Michael McGrath, and his officials and I believe the Government will make a decision in the best interests of the hospitality sector, looking at hotels, restaurants, bars and the tourism sector as a whole. I have been assured there is significant support for what I have proposed within the Fianna Fáil Parliamentary Party.

It should also be noted that the hospitality sector was perhaps the hardest hit by the pandemic and that large parts of it were shut down for two years. The sector has moved from one crisis to another over the past few years, none of which has been of its own making. The cost-of-living challenges facing Europe and most of the world means consumers are becoming much more careful with their budgets and where they plan to visit. They are looking for more value for their buck and being more thrifty as they try to make their disposable income go further. As a welcoming country, we cannot afford to make Ireland less competitive at this point. The thousands of businesses, mainly SMEs, and the hundreds of thousands of people working in this sector need Government support. For this reason, I urge the Leader to raise this matter with Government Ministers to have it addressed and get the right outcome for all of our people.