Pubs welcome rates (i.e. property tax) suspension

17 April 2020
By Elaine Murphy

Explainer: Commercial Rates is a local commercial property tax which part funds the expenditure programmes of City/County Councils. Rates are charged on commercial properties such as shops, offices, factories, warehouses, hotels, licensed premises etc.

News from the pub industry

The Vintners’ Federation of Ireland (VFI) has welcomed confirmation from government that commercial rates will be suspended while pubs are closed during the Covid-19 crisis.

VFI Chief Executive Padraig Cribben states: “This commitment from government to suspend commercial rates for pubs for the duration of the crisis is welcome news for our sector, which has already been closed for almost five weeks.

“Commercial rates are a significant annual expense so this decision will help ease the pressure on publicans. This is a good start but publicans will need government to introduce a suite of business supports if the sector is to remain viable. Our members understand that public health is the number one priority but charting a path out of the crisis is now required.

“Serious consideration will have to be given to outstanding VAT and PRSI commitments as there will need to be a level of debt forgiveness if we are to have any hope of rebooting the hospitality sector.

“A grant system for small businesses to aid liquidity is also essential. Once pubs reopen our members will need working capital, which traditionally they might have borrowed from banks at a commercial rate. In the ‘new normal’ we’re calling on government to establish a mechanism to allow ECB funds, which are borrowed at zero percent interest, be passed on to SME customers at the same low rate.

“We will continue talking with government over the coming weeks, but at this stage it’s clear that new thinking will be required if the hospitality sector is to survive a prolonged shutdown.”

File image of Local Authority logo

However, Rates are collected by, and fund, Local Authorities. Here in Cork, this national decision means that Cork City Council and Cork County Council stand to lose a sizeable portion of the income. Will this affect services?



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