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Seanad
‹ An tOrd Gnó - Order of Business

Border counties VAT pressure

Summary

Senator Gallagher warned that the UK VAT cut for hospitality and services would create a competitive disadvantage for businesses in Border counties.

Mark Daly An Cathaoirleach

I thank Senator Higgins for raising the issue of the importance of the Seanad and the principle of allowing all Members to be able to vote on any Stage of a Bill. I call Senator Gallagher.

Comment on this

The measures announced by the UK Government yesterday, including cutting VAT on its hospitality and services sector from 20% to 5%, have set alarm bells ringing across the Border counties in the last 24 hours, from Donegal right across to Louth. The measures introduced by the UK Government yesterday will be in place, I understand, until 12 January 2021. Businesses in Cavan, Monaghan and other Border counties currently have a VAT rate of 13.5%. We are now asking those businesses to compete against other businesses four or five miles down the road in Northern Ireland which are operating a VAT rate of 5%. This is clearly not a level playing field and it is one that will have to be addressed in the July stimulus package.

Many businesses in the Border counties, and indeed businesses all over the country, are struggling to survive at the moment and we all realise that. The Government needs to be particularly cognisant of the difficulties of businesses located along the Border in counties such as Monaghan and Cavan. I hope the July stimulus package will offer the Government an opportunity to note the difficulties businesses in those counties face when competing against businesses in Northern Ireland. Many people in the business community are looking forward eagerly to the announcement of the July stimulus package and I hope that perhaps some of the issues already announced could be addressed in that.

The restart business programme which was announced offers grants from €2,000 up to €10,000 for businesses. I accept it was introduced as an emergency measure, but it has been very problematic.

Many businesses, such as travel agencies, whose turnover may be in excess of €5 million are also losing out. In addition, many small car dealers whose turnover may be in excess of €5 million are losing out. It is vital we address those problems in the July stimulus package.

Will the Minister alert or advise me as to when the SME task force will be up and running? Go raibh maith agat, a Chathaoirligh, and thank you for the latitude.

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