The Tánaiste has indicated that the Government may be prepared to consider extending the deadline for businesses who warehoused tax debts to the Revenue Commissioners during the Covid-19 pandemic, in order to help many struggling operators in the restaurant sector.
The Restaurants Association of Ireland says 280 food-led hospitality businesses closed in the last six months of 2023.
The association blamed the closures on a number of factors, including increased wage and raw material costs and the impending May 1 deadline for businesses who warehoused their tax debts during the pandemic to settle their accounts with Revenue.
Speaking this afternoon in Cork, Micheál Martin said the Government had "stepped up to the plate" by providing supports to the hospitality sector when restrictions on people's movements during the Covid pandemic meant they couldn't socialise.
Mr Martin also acknowledged that restaurants were continuing to struggle post-Covid and he indicated that the Government may be prepared to intervene on the issue of the warehousing of tax debts.
"I think what we are witnessing is a more long-term effect of Covid," Mr Martin said.
"I think Covid's impact on a whole range of the economy and society is not gone away and I think people went through a lot of difficulty during Covid. A lot of businesses did, because of the lack of footfall.
"I think, on the warehousing of tax, that is certainly something I think we can look at and I will talk to the Minister for Finance, Michael McGrath, in respect of that to see if that can be structured.
"It had already been re-structured to some degree in respect of phasing, but our objective is to keep businesses open. There is a 250 million euro allocation in our cost-of-living package that accompanied the Budget for businesses generally in terms of grant availability. That is there for businesses that they can take up."
Mr Martin offered less hope in relation to reducing the VAT rate in the hospitality sector from 13.5% to 9%. The lower rate had been applied during the pandemic, until it was restored to the higher rate last September.
He said what the Government had noticed, particularly in relation to hotels, was that even when the lower VAT rate was applied, prices had increased.
Mr Martin denied that the Government was ignoring the restaurant sector and said he was willing to meet hospitality industry representatives.
