THE GOVERNMENT should resist any temptation to introduce a “fat tax” on restaurants and instead reduce the VAT on meals in order to protect jobs in the hospitality sector, according to the industry’s representative body.
The Restaurants Association of Ireland yesterday published an ambitious 10-point “survival plan” which outlined “a series of urgent actions needed now if the restaurant sector is to continue to recover”.
The plan called for a reduction in excise duty on wines served in restaurants with meals, changes to how VAT was calculated on bills, a re-examination of the rates system and an extensive training programme for people working in the hospitality sector, to be paid for by reduced employer PRSI contributions.
The association said a reduction in the excise duty on wine served as part of a meal would curb excessive home drinking. It said any increase in excise duty should be levied towards below-cost selling of alcohol.
It also said food and healthy eating should become part of the curriculum in primary and secondary schools and claimed any sugar or fat tax proposals would have a “negative impact” on low-income families.
The association said the correct approach to tackling obesity was through educational awareness. “A blanket fat tax will not create a healthier society and the association is advocating for a holistic approach where businesses, public and private sectors, community and voluntary would play a part in tackling this issue,” it said.
It also said all tourism and hospitality services should engage in the customer training programmes throughout 2012 and called for the cost to be offset against employers PRSI.
It wants all public and private transport services including taxi drivers, bus drivers and operators to undergo customer service training.
It described the present rates system as unfair and said it was a direct cause of business closures and job losses.
The Government needed to undertake a comprehensive review of the present rates system with the aim of “funding local government on a more equitable and sustainable basis”, it said.
It wants a review group to examine the rates system in detail, consult with all interested parties, and recommend the best alternative.
“This budget shouldn’t be about adding more taxes and stealth charges to small business and restaurants to keep the troika happy,” chief executive Adrian Cummins said.
“Budget 2012 should be about jobs, jobs and jobs. Creating a fat tax will cost jobs.
“Making employers pay four weeks’ sick leave will cost jobs. And increasing excise duty will drive consumers to the North of Ireland costing jobs in the Border counties.”
He said the industry employed 64,000 people and contributed €2 billion to the Irish economy each year.
The association claimed that 93 per cent of its members had passed on a VAT cut aimed at boosting tourism which the Government introduced in July.
It added that “anecdotal evidence” suggested that restaurant prices had fallen by between 10 and 15 per cent over the last five years.
