|
|
"VAT trap will kill Inishowen
businesses"
26.11.08
A Donegal TD has warned
that the British Government’s decision to slash VAT
will "wipe out" thousands of businesses in the
county.
Deputy Joe McHugh has written to Finance Minister
Brian Lenihan demanding urgent action to stem the
haemhorrage of trade from the border region.
He said Britain's move to cut VAT was in stark
contrast to Mr Lenihan's decision to raise VAT by
0.5%. VAT in the North will now be 15% while in the
Republic, the rate will be 21.5%. |
 |
“The huge difference in
the rate of VAT between the Republic and the UK,
together with the much higher cost of doing business
here, is going to wipe out thousands of businesses
in the border areas and make it very difficult for
the economy as a whole to trade our way out of
recession," said the Fine Gael deputy. "Consumers
from the Republic can save more than 30% by shopping
for clothes, groceries and alcohol in the North.
This is reflected by a survey that shows 40% of
shoppers at a number of shopping centres in the
North are from the Republic. |
The low cost of
sterling, together with the imminent reduction in
the British VAT rate, will drive this figure further
up between now and Christmas," he warned.
He compared Finance Minister Brian Lenihan's
strategy to British Exchequer Chancellor Alistair
Darling. “The British Government is responding to
economic difficulties with a super-competitive
currency and sophisticated reductions in indirect
taxes. In comparison to this, the Fianna Fáil
Government is hiking up taxes on Irish consumers and
traders. Southern border businesses are suffering as
a result.
"I have written to the Minister for Finance
demanding that immediate action is taken to address
the difficulties afflicting businesses in the border
region.” |
|
