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VFI Calls on Local Authorities Not to Raise Rates in Difficult Economic Climate

02-November-2008

An Increase in Rates will Cripple Small Businesses and Lead to Pub Closures

The Vintners’ Federation of Ireland (VFI) today issued a plea to local authorities not to raise commercial rates for businesses in the coming year.

The VFI, which represents 5,000 pubs in Ireland outside of Dublin, has made contact with other trade associations and chambers of commerce in an effort to persuade local authorities not to impose another hike in rates. Letters outlining the VFI position have been written to county managers and local authorities.

In what is already an extremely difficult economic climate, the VFI is urging local authorities not to raise rates for publicans and indeed other businesses. According to figures released by DIGI, the group representing the Drinks Industry, 1,500 pubs have closed since 2001 and further increases to rates would only serve to exacerbate this.

Val Hanley, President of the VFI, said; “Publicans have faced an enormous amount of increases in costs in the last five years with water, refuse and other rates spiralling way ahead of inflation and far in excess of what is affordable to most businesses.”

Rates have increased by 46% over the rate of inflation over the five year period to 2007. These rates are a property tax levied by Local Authorities on the occupiers of commercial and industrial property.*

On top of commercial rates, publicans and businesses have to pay water rates and refuse charges. In the same five year period, water rates have at a minimum doubled and in some cases trebled. This is crippling many publicans and small businesses.

Publicans also face huge entertainment costs every month for SKY, Setanta and IMRO. In many cases, these costs are over €1,000 per month or the equivalent of a small mortgage, just for providing television entertainment.

Val Hanley said; “With all these charges way exceeding the rate of inflation over the last number of years, I hope that local authorities do not look to generate funds in the coming year from easy targets like pubs and small businesses due to the shortfall in income from planning and development revenues. Small businesses in Ireland are already under enough pressure without another hike in rates.

“With many pubs already struggling, another hike in rates from local authorities would be disastrous in many cases.”