Failure to end VAT break for non-compliant hospitality sector
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The failure of the Minister for Finance, Michael Noonan, in Budget 2016 to end the preferential VAT rate enjoyed by the hotel and restaurant sector, which includes many businesses exploiting low paid workers has been condemned by SIPTU.
SIPTU Services Division Organiser, Ethel Buckley, said: “The cost in lost revenue to the State of the reduction of the VAT rate in the sector from 12.5% to 9% introduced in 2011 has been €1.4 billion.
“This cost has been met directly by workers. The private sector pension levy was also introduced in Budget 2011, and the finances it generated were used to offset the cost of the tourism and hospitality subsidy.”
She added: “Despite steady growth and increased revenues, employers in the hospitality sector are continuing to veto the Joint Labour Committee (JLC) process established by the State in January 2014 for agreeing statutory minimum wages and conditions for workers in the sector.
“The continuing hostility and lack of engagement from employers in this regard is totally incompatible with the maintenance of State subsidies.”
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