Garret Ahearn (Fine Gael) | Oireachtas source

I thank the Minister for being here and taking this Commencement matter. Before I speak about the 9% VAT rate, which is being pushed very hard by sectors across the country that are struggling, the hospitality sector in particular, it is first important to acknowledge what his Department and this Government have done. Since we have been in government in 2011, we have always held the Ministry for Enterprise, Trade and Employment within Fine Gael. We have done that because we have always been pro-business and we want to support businesses. Even in recent weeks, the number of measures the Minister and his Department have brought forward to support businesses through the cost-of-living crisis and the cost of business over recent months has been hugely helpful and will continue to be. As discussed, the increased cost of business grant that is being availed of by businesses right across the country, including in my county of Tipperary, is very important. When it was introduced in the budget, it was introduced to be very easy for people to apply for and to be done within the first quarter of 2024, and the local authorities would be able to give out that money very easily. Unfortunately, in Tipperary, only 42% of the businesses that have applied for it have actually got the money. We are trying to give money to those businesses as quickly as we can because we understand the pressures they are under, but for some reason the county council in Tipperary has not given that money to 58% of the businesses that have applied for it. It is crucial that they get it. Would the Minister be able to engage with the county council on that? I do not know if he has already, but perhaps he could continue to engage. There is an acting chief executive there at the moment who would be very happy to engage on this issue, I suspect, but it is important that that money gets to those businesses as quickly as possible.

In the broader scheme of things, and as regards the long-term support the hospitality sector, in particular, needs, we really need to look at the 9% VAT rate and returning to it. Looking at figures at the moment, almost two businesses every day are closing, and one of the main reasons they talk about is the increased costs to them and, in particular, the 50% increase in the VAT rate from 9% to 13.5%. I know we reduced it and it was always going to be temporary, but we recognise as a Government that these businesses are struggling.During negotiations between the Minister's Department and the Department of Finance, will the Minister ensure that this is a priority for this Government, the Minister's Department and him as Minister? A survey of 212 businesses was done only last week by the Restaurants Association of Ireland and 74% of those surveyed said they expect to close this time next year if the VAT rate of 9% is not reinstated in budget 2025. Some 66% said they would have already closed if it were not for the ongoing campaign for the return to a VAT rate of 9%. To put it in clear figures, Jim Power, a very respected economist, said that the average restaurant closure costs the State €1.36 million. It is a positive for us from a revenue perspective that we try to keep these businesses open as best we can. Having a split VAT rate between food-led businesses and hotels has been done in other EU countries. It would not be unusual. I often say we cannot justify dropping the rate from 13.5% to 9% for hotels, just as we cannot justify having restaurants and food-led businesses at 13.5% at this time. I know the Minister is open and willing to negotiate with the Department of Finance on this to support those businesses in the budget. This is a key request by the Restaurants Association of Ireland, which has been very vocal on the matter, and other organisations. If we want to secure the future of these businesses, which are small and medium sized businesses in rural towns like my home town of Clonmel, Cahir and Cashel, they need support over the next number of years. We need to fight hard for this. As I said at the start, Fine Gael is pro-business in rural areas like mine. This is a key statement we can make in budget 2025.