Hoteliers To Meet Budget Ministers
In advance of a meeting with Minister Paschal Donohoe and Minister Jack Chambers on this Wednesday, the Irish Hotels Federation has set out a number of targeted measures required to safeguard the long-term viability of the tourism and hospitality industry. The meeting in the run-up to Budget 2026 takes place against a backdrop of ongoing challenges for the industry, including serious cost competitiveness issues for hospitality food-related services.
IHF President Michael Magner says:
"It is vital that the Government takes decisive action to place Irish tourism and hospitality on a more stable and competitive footing. Businesses the length and breadth of the country are struggling to deal with exceptionally high operating costs and tight margins. This is especially challenging for regional food businesses. These businesses are now threading a fine line between covering ever-increasing costs and losing competitiveness."
For Budget 2026, the IHF urges the Government to deliver on its commitment to reduce the rate of VAT on hospitality food businesses:
"A rate of 9% VAT for food-related services would align us with the majority of our European competitors. For instance, Germany has recently announced a reduction in its VAT rate on food services to 7% from January next year, down from 19% currently in place. This move recognises the broader social and economic role played by the hospitality sector and the particular challenges facing food businesses.
"We need a similar approach here in Ireland without delay. Restoring the 9% VAT rate for food-related services from January would be a vital policy intervention for a sector that supports over 270,000 livelihoods and contributes significantly to the economy."
Mr Magner notes that 18 of the EU’s 27 member states apply a food VAT rate lower than Ireland’s 13.5%. The average rate among those 18 countries is just 9.5%.
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