{"id":480732,"date":"2025-10-07T15:56:16","date_gmt":"2025-10-07T15:56:16","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/480732\/"},"modified":"2025-10-07T15:56:16","modified_gmt":"2025-10-07T15:56:16","slug":"ni-at-competitive-disadvantage-in-hospitality-and-retail-after-irish-budget","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/480732\/","title":{"rendered":"NI at \u2018competitive disadvantage\u2019 in hospitality and retail after Irish budget"},"content":{"rendered":"

Speaking to D\u00e1il \u00c9ireann, Irish finance minister Paschal Donohoe confirmed the introduction of a reduction in VAT for hospitality (excluding hotel rooms) from 13.5% to 9%, while Jack Chambers, the public expenditure minister, announced \u20ac12.2bn to be spend on expanding water and wastewater services.<\/p>\n

Hospitality Ulster expressed concern that the VAT cut harms Northern Ireland\u2019s competitiveness, while Build Homes NI, a group of building firms advocating major investment in NI\u2019s wastewater said the Irish government\u2019s spending will cause more local housebuilders to \u201clook for opportunities\u201d south of the border.<\/p>\n

Colin Neill, the chief executive of Hospitality Ulster, said that, as the only part of the UK that shares a land border with the EU, the VAT differential has \u201ca direct impact on local business\u201d.<\/p>\n

Hospitality businesses in Northern Ireland pay a VAT rate of 20%, as businesses do in the majority of sectors across the UK.<\/p>\n

Ireland\u2019s cut to VAT will have a major impact on money brought in via taxation, with some estimates saying it could cost the exchequer \u20ac681m in a full year.<\/a><\/p>\n

Mr Neill said: \u201cThe Irish government\u2019s decision to reduce VAT on hospitality from 13.5% to 9% on food once again highlights the growing competitive imbalance facing Northern Ireland\u2019s hospitality and tourism industry.<\/p>\n

\"Colin<\/p>\n

Colin Neill<\/p>\n

\u201cOur hospitality sector operates under immense pressure from rising costs, staff shortages, and a 20% VAT rate that is one of the highest in Europe.<\/p>\n

\u201cWith the Republic of Ireland now making this latest VAT reduction, Northern Ireland businesses will be placed at an even greater disadvantage when competing for visitors, events, and investment across the island.<\/p>\n

\u201cNorthern Ireland is the only part of the UK sharing a land border with an EU member state. The VAT differential has a direct impact on local businesses, particularly in the border counties where competition with the Republic is strongest.<\/p>\n

\u201cThe time for action has long since passed. The UK Government must recognise Northern Ireland\u2019s unique position and act immediately to level the playing field by introducing a pilot VAT reduction for hospitality and tourism here.<\/p>\n

\u201cHospitality is the cornerstone of our tourism offering, supporting more than 72,000 jobs and contributing \u00a32bn annually to the local economy.<\/p>\n

\u201cIf we are to sustain and grow this vital sector, decisive intervention is needed now to ensure Northern Ireland remains competitive within the all-island tourism market.”<\/p>\n

\"Ireland's<\/p>\n

Ireland’s Minister for for Public Expenditure Jack Chambers and Minister for Finance Paschal Donohoe (Niall Carson\/PA)<\/p>\n

Budget 2026 preview<\/p>\n

Meanwhile, Mr Chambers said Dublin’s investment in water and wastewater services is necessary to ensure more homes are built in the Republic.<\/p>\n

Build Homes NI was founded to advocate for investment in Northern Ireland\u2019s wastewater services, describing issues with that infrastructure as the biggest barrier to building projects here.<\/p>\n

Speaking recently to the Financial Times<\/a>, the CEO of Invest NI Kieran Donoghue said a lack of wastewater infrastructure was the biggest barrier to firms being able to take advantage of Northern Ireland’s dual market access.<\/p>\n

Mr Donoghue said: \u201cDual market access under the Windsor Framework is fundamentally a manufacturing opportunity and manufacturers need water in, water out.\u201d<\/p>\n

\"Invest<\/p>\n

Invest NI chief executive Kieran Donoghue<\/p>\n

Paul McErlean, a director at Build Homes NI, said: \u201cIt is forecast that within its next Price Control period NI Water will face a \u00a32bn deficit because of its broken funding model.<\/p>\n

\u201cConsequently, Northern Ireland is facing a permanent wastewater crisis.<\/p>\n

\u201cThe evidence is all around us \u2013 historically low levels of housebuilding; record levels of homelessness and accelerating rental costs that are pricing young people out of the housing market.<\/p>\n

\u201cOur waterways are being degraded by pollution and the economy is losing jobs and inward investment, particularly in the manufacturing sector which relies upon water connections.<\/p>\n

\"Paul<\/p>\n

Paul McErlean, founder of MCE, and Carl Daruvalla, chief executive of Cavendish<\/p>\n

\u201cHousebuilding is becoming increasingly difficult in Northern Ireland. Today\u2019s announcement by the Irish government will only accelerate the trend for local housebuilders to seek out opportunities south of the border in the absence of suitable sites in their home market.<\/p>\n

\u201cThis is a system-wide failure which demands a long-term, system-wide solution led by the NI Executive.<\/p>\n

\u201cRather than let the issue drift until the next Assembly election, now is the time for the parties to bring forward credible proposals that begin to tackle the underlying problem of NI Water\u2019s funding model.\u201d<\/p>\n

Other policies to promote homebuilding announced by the two Irish ministers included a 7% derelict property tax and \u20ac5 billion capital funding for housing delivery in 2026.<\/p>\n

Elsewhere in Tuesday\u2019s budget, the Irish government announced a \u20ac10 increase to the pension, jobseeker’s allowance and disability benefit, a rise in minimum wage of \u20ac0.65 per hour to \u20ac14.15 and an increase to carbon tax on auto fuels.<\/p>\n

The budget also contained a multiyear commitment of \u20ac3m annually to fund academies for League of Ireland football teams.<\/p>\n

The budget package is worth \u20ac9.4bn overall, and the Irish government expects the economy to add 63,500 more jobs in the next year. <\/p>\n","protected":false},"excerpt":{"rendered":"Speaking to D\u00e1il \u00c9ireann, Irish finance minister Paschal Donohoe confirmed the introduction of a reduction in VAT for…\n","protected":false},"author":2,"featured_media":480733,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5011],"tags":[9085,1144,16,15],"class_list":{"0":"post-480732","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-northern-ireland","8":"tag-james-mcnaney","9":"tag-northern-ireland","10":"tag-uk","11":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115333706349418104","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/480732","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=480732"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/480732\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/480733"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=480732"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=480732"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=480732"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}