The owner of a restaurant in Sligo has predicted that the Government’s VAT cut for the hospitality sector is unlikely to ‘reduce the price of a cup of coffee’ - but it will create jobs. 

Today, the VAT rate for food businesses and hairdressers falls from 13.5% to 9%, following years of campaigning from the sector. 

Tánaiste Simon Harris predicted that the measure would “help thousands of businesses across Ireland and in turn will help secure approximately 150,000 jobs right across the country."

On The Claire Byrne Show, restaurant owner Anthony Gray said the 13.5% VAT rate and cost of living crisis have left the restaurant sector “on its knees”, adding that he is delighted with VAT reduction. 

“It'll create jobs,” he predicted. 

“And I think the Government and the Tánaiste realise that; it's not about reducing the price of a cup of coffee. 

“The price of everything has gone through the roof, but what it will do is it'll give us a little bit of wiggle room.” 

A restaurant in Galway. Picture by: Alamy.com.

As a result of the huge surge in inflation over a period of several years, Mr Gray said there are now “enormous costs of running a restaurant”. 

“The cost of food has gone through the roof,” he explained. 

“Inflation has gone through the roof; even here in the house myself with three kids, I see the price of stuff going through the roof. 

“It will help us to keep our doors open, keep jobs open, keep families that are working in the hospitality industry, keep them employed and look after them.” 

Overall, Mr Gray described the VAT cut as a “vital measure” and promised that the industry will “pass it on in some instance”. 

“Obviously, we want people coming through the doors - that's how we survive,” he said. 

“We don't get paid weekly; we get paid when people come in through our doors. 

“So, we will be able to pass it on with incentives - as I do here in Sligo with a pre-theatre dinner menu and coming up with different specials and buying stuff from local suppliers. 

“It's fantastic; fair play to the Government, I have a chance now of hanging on and staying open.” 

Main image: A woman cup of coffee. Picture by: Alamy.com.