Helpline: Government should confirm that no VAT increase will be introduced before Christmas
Ministerial reassurance of no VAT increases before Christmas will help to boost consumer confidence and support stretched businesses
RGDATA, the group representing the independent grocers in Ireland has called on the Minister for Finance to publicly confirm that there will be no VAT increases before Christmas. RGDATA said that such confirmation was required to give consumers confidence to spend money now, rather than going North or deferring purchasing decisions until after the Budget to see when any increase in VAT rates will apply.
RGDATA Director General, Tara Buckley said that Minister Noonan has publicly indicated that he has no discretion about increasing VAT rates and says that Ireland is bound to introduce increased rates under the EU/IMF deal. RGDATA believes that a VAT increase will not be good for the Irish economy and should be resisted by the Government. However if the Minister believes that he has no alternative other than to increase the VAT rates, he should not bring in any changes until after the Christmas trading period.
Buckley commented
“Many retailers are just surviving in the current very difficult trading environment. They need to see a strong Christmas trade to allow them stay in business. Any VAT increase in the run up to Christmas will be a serious setback to these businesses and has the potential to seriously undermine the Christmas trade that they depend on to get them through the year.”
“Even the threat of a VAT increase hanging over consumers in the current climate between now and Christmas is very damaging for consumer confidence. Many retailers are reporting that the threat of a VAT increase applying between Budget Day and Christmas is already having a negative impact on consumers’ confidence and spending decisions.”
Tara Buckley called on Finance Minister Michael Noonan to come out publicly and state that any VAT increases that will be introduced will only apply from 1 January 2012 and will not be targeted at this year’s Christmas trade. She said that such confirmation would give consumers and retailers greater confidence and encourage people to start spending.
For further info contact RGDATA 01-2887584 or email rgdata@rgdata.ie
