Dáil Éireann Debate, Tuesday - 17 October 2023
205. Deputy Fergus O'Dowd asked the Minister for Enterprise, Trade and Employment to respond to concerns raised by the Restaurants Association of Ireland (details supplied); and if he will make a statement on the matter. [45189/23]
View answerI am very aware of the continuing challenges that businesses, including restaurant businesses, still face due to the cost of living crisis. For that reason, we are introducing the Increased Cost of Business Scheme (ICOB). The ICOB will be a targeted grant payment paid out by local authorities which will apply to businesses operating out of a rateable premises, at a rate of up to half their commercial rates bill, for business who pay up to €20,000 in rates. The scheme will benefit up to 130,000 Small and Medium enterprises.
The technical details underpinning the scheme and the mechanism for delivering the payment are currently being developed. It is intended that qualifying businesses will receive payment in the first quarter of 2024. It is important to be clear that this scheme is a once-off grant aid provision and not a commercial rates waiver. It will have no bearing on the commercial rates paid by firms.
Full details of all supports available to businesses including the Business Users Support Scheme for Kerosene which is open until 30th October for applications is available on my Department’s website Supports for SMEs - DETE (enterprise.gov.ie).
The VAT reduction was in place from November 2020 to August 2023 at a gross cost to date of €1.2bn, which represents a very significant support by Government for a vital sector of the economy. It was one of many measures provided to support businesses.
It is not correct to say that Ireland has the highest VAT rate on hospitality in the EU at 13.5%. In addition, comparing VAT rates across Europe can also paint a misleading picture in that it does not account for other taxes paid by businesses, including corporation taxes and local taxes.
In making any decision in relation to VAT rates or other taxation measures, the Government must balance the costs of the measures in question against their impact and the overall budgetary framework.
As part of the Budget settlement secured for tourism in 2024, up to €10M has been identified for a comprehensive programme of supports targeted at downstream tourism businesses experiencing particular trading challenges linked to the reduction in footfall to activities and attractions in regions most impacted by tourism bed stock displacement. This programme of supports includes investment in sustainable tourism development and promotion, industry digitalisation, promotion of domestic tourism and festivals and recruitment and retention initiatives.
€3m has been allocated to Fáilte Ireland to help tourism businesses improve their energy efficiency. This investment will overtime help businesses to reduce overheads and dependency on fossil fuels while supporting the sector in the delivery of its climate targets by reducing carbon emissions.
€2million to assist Tourism Ireland target value-adding tourists and promote Ireland as a sustainable destination with compelling and authentic reasons to travel to those regions most impacted by tourism accommodation stock displacement.
€1.5 million will support ongoing work under Fáilte Ireland’s Employer Excellence Programme which aims to address the current recruitment issues. Tourism businesses are in every region of the country and sustain people living and working in areas, where often there is no other industry operating. This is a 3-year programme that has, since 2022, supported 390 tourism businesses and Fáilte Ireland will now be extending the scope of the programme to engage and support businesses with less than 20 employees with a particular focus on attractions and activity providers.
Minister for Tourism, Culture, Gaeltacht, Heritage, Sport and Media, Catherine Martin TD., has asked Fáilte Ireland to examine the scope for a specific business support scheme that could help the most affected tourism activities and attractions and to report back on options and recommendations in four weeks’ time.
The Government are mindful of the impact and cost implications of the new legislation to improve working conditions in Ireland. As part of Ireland's Competitiveness Challenge (ICC) report for 2022, the National Competitiveness and Productivity Council (NCPC) recommended that an evaluation be undertaken of measures proposed to improve working conditions in Ireland. Following this advice, officials from my Department are collaborating with the Department of Social Protection on an assessment of the cumulative impact of these measures.
