Every restaurant, café or other food-led business closure in Ireland could result in the State losing out on up to €1.36m in value each year and an average of 22 people losing their jobs – that’s according to a new report published today by the Restaurants Association of Ireland (RAI).
More than 200 restaurants and cafes in Ireland have shut this year.
Donegal has also seen a series of well-known businesses shut their doors for good in recent months, with many citing running costs as the contributing factor.
The RAI estimates the economic cost to these closures is €288 million annually. The €1.36 million figure per business is an accumulation of lost wage payments, payroll taxes, VAT receipts, commercial rates, water charges and also accounts for the knock-on impact a closure has on spending in the local economy and on local suppliers.
The RAI is fighting for the 9% VAT rate to be reinstated in the next Budget in October. The Department of Finance has said this will cost €545m a year.
The report, The Economic Impact of Restaurant Closures, compiled by Jim Power, claims that if 400 restaurants eventually close, the State will begin losing more money than it would have cost it to lower the VAT rate.
