#TaxedOut: A year on and support for Hospitality no further forward

A year to the day when we last took stock of the challenging landscape for the hospitality industry and it’s safe to say that in those 365 days… little has improved.

In a newsletter published on October 8, 2024 Armagh I detailed the loss of four popular cafés from Portadown’s high street in a matter of weeks and asked: “What is being done to safeguard the future of our independent eateries?”

Even before that, this publication highlighted many of the borough’s valued bars and restaurants had been “priced out of existence” since the pandemic.

In both those articles, the complaints of business owners were consistent. There was a lack of financial support, no input from Government to incentivise recruitment for the dying industry, rising costs – from supplies to utilities – and a general laissez-faire attitude that left many wondering how they would continue to turn the key in the door.

Speaking last year, Upper Bann MP Carla Lockhart recognised the loss of these businesses within her constituency as being part of a “wider issue”.

The MP pledged to call on the UK Government and Department for the Economy in the NI Assembly to “step up and act now”.

Her approach at the time - like many local representatives - was to call for a VAT reduction in line with the Republic of Ireland.

Ms Lockhart said: “Reducing VAT and tackling the crippling business rates are vital steps to help these businesses survive. We cannot afford to lose more of the places that make our town centres the vibrant places they are.

“I will continue to push for urgent support for our local businesses, so they can thrive and continue to play a crucial role in our community.”

However, in the months following the MPs announcement we have seen yet more local eateries switch off the lights for financial reasons with Andy Joe’s, Banbridge closing in July and Charlie’s Chipper, Hamiltonsbawn in August.

Others have also disappeared from high streets and rural areas but have not always been as vocal about their reasons for doing so. Nonetheless, they are still gone.

A survey conducted by UK Hospitality at the start of October - and shared by Hospitality Ulster - asserted that 74% of the public believe hospitality deserves more support.

Said the trade body: “Our high streets are dying before our eyes. And yet, since last October’s Budget, nearly 89,000 jobs have vanished in hospitality alone.

“We’re sounding the alarm. We’re being #TaxedOut.

“In the 2025 Budget, we’re calling for change to support the hospitality sector. Lower business rates, a fix to employer NICs, a cut in VAT.

“This is about more than economics. It’s about preserving the beating hearts of our communities - our cafés, pubs, restaurants, local meeting points.

“We need your voice. Share this post, tag your MP, use #TaxedOut, and let’s make sure they hear us loud and clear.”

Joining the chorus, SDLP MLA for Newry and Armagh, Justin McNulty asked the Minister for the Economy to outline any plans her Department has to help hospitality businesses, “given the disparity in VAT rates between the North and the South”.

In response to the request Minister Dr Caoimhe Archibald said she was “aware of the challenges facing our hospitality industry with rising costs, particularly in relation to the higher VAT rates faced by businesses here relative to the South”.

“I engage regularly with representatives of the hospitality industry, meeting recently with the NI Food to Go Association and Hospitality Ulster.”

However, the Minister clarified that VAT is an “excepted matter” and decisions to change the rate of VAT rests with the British Government which, the Minister says, has “unfortunately not shown any willingness to address this matter so far”.

Continued Minister Archibald: “When Finance Minister, I commissioned a research report on the cost of doing business. It was published in May this year and sets out further evidence concerning the disparity of VAT, especially for our hospitality businesses operating near the border.

“This is an issue that the Finance Minister has raised with the Chief Secretary to the Treasury (CST) both in writing and when they met earlier this year. I understand the Finance Minister has urged the CST to consider the case for a reduction in VAT to enable our hospitality businesses to compete on a level playing field in the all-Ireland economy. “

To this end, the Minister has pledged to “continue to work with the Finance Minister as we continue to press the British Government to consider all possible means of putting a VAT regime in place that enables our businesses to compete within the all-Ireland economy”.

“My Department and partner organisations provide a broad range of support to businesses to help them be more competitive through energy efficiency, innovation, skills, and exploring new markets.”

Encouragingly, several new hospitality businesses have been opening across Armagh’s high street as of late.

While a few substantial vacant premises remain, the fresh blood has been welcomed and interest from the public has been promising.

Undoubtedly, financial assistance - in any form - would make the first few years in business a little less taxing, for all.