Ulster Unionist Economy Spokesperson Diana Armstrong MLA is calling on Executive Ministers to put forward the case for VAT harmonisation with the Republic of Ireland. Diana says that this will help deliver a level playing field for our Hospitality and Tourism providers who are facing unfair competition just across the border.

Ms Armstrong said, “The hospitality and tourism sector is a vital component in the outward-facing image of Northern Ireland – it is pivotal in demonstrating all that is good about our country – the stunning landscapes, the warm welcomes, storytelling, food, music and culture. This industry, however, over recent years has experienced significant setbacks in terms of the Covid pandemic, and the cost of living and cost of doing business crisis. Hospitality and tourism have always shown admirable resilience. 

“However there are three looming threats to the survival of this industry in Northern Ireland – namely the disastrous fallout from the Chancellor’s Budget with the planned rise in Employer’s National Insurance contributions, the introduction of the Electronic Travel Authorisation and most recently the announcement from the Irish Government on its intend to lower VAT from the current 13.5% to 9% on hospitality in the Republic of Ireland. This VAT differential is the final straw for many within the hospitality trade, who operate within close proximity of the border region.

“The planned reduction in the Republic of Ireland of hospitality VAT from 13.5% to 9% will mean a substantial differential of 11% on rates across the border on hospitality and this will be a huge threat to the confidence of operators in the hospitality and tourism industry in Northern Ireland. 

“I brought this motion forward today to really highlight the challenge for our hospitality and tourism sector, and urge the Executive to make the case on the derogation of Hospitality VAT to help safeguard and promote growth in the sector. It’s time to level the playing field on VAT, the Finance and Economy Minister must work with the industries that are facing unfair competition and Government-driven tax raids on their livelihoods. In the absence of lowering hospitality VAT, the Executive must put in place an interim package of support for this vital sector until such a time as the UK Government recognises the special case that exists in Northern Ireland.”