Plans unveiled to help struggling businesses in Derry
The 15 industry bodies said a “perfect storm” was causing devastation for the retail and hospitality sectors.
Businesses are seeing a fall in trade and customers, as a knock-on effect of the cost-of-living emergency.
That, coupled with rising inflation and Covid-19 pressures, had brought businesses to a “critical juncture”.
The group, which includes Retail NI, Hospitality Ulster, Northern Ireland Takeaway Association and local chambers of commerce, have issued a joint statement.
They are calling for measures including a 17% reduction in VAT and for the reduced tourism/hospitality VAT rate to be reinstated for businesses that rely on household discretionary disposable income and tourism spend.
It said customers are being pushed away from local businesses as they are “having to raise prices to keep pace with rising costs”.
“Out-of-control energy bill increases, labour shortages, inflation, National Insurance increases, and sky-high business rates – the highest in the UK – are risking the business climate of Northern Ireland,” the trade organisations said.
“Fears that many will simply go under in the next months without government assistance are keenly felt and we cannot continue on this path of destruction any longer.”
The group is also calling for urgent intervention by the UK government, along with the “limited powers of Northern Ireland Executive ministers”.
Key proposals of the plan
Reduce VAT to 17%
Reinstate the lower tourism / hospitality VAT rate to support businesses that rely on household discretionary disposable income and tourism spend
Restore the business rates holiday, which ended in July 2022, until April 2023
Reform of the business rates system to ensure online and out-of-town businesses pay the same rate as high-street businesses
The UK government should help the devolved nations to reduce business rates by providing increased financial support through the block grants
Remove VAT from energy bills
The Stormont Executive should establish a fund to ensure small and mid-sized towns and villages are supported during the crisis.
Anna Doherty, interim chief executive of Derry Chamber of Commerce, told the same programme that the decrease in VAT rates would “immediately put money into people’s pockets”.
“That’s what we need and we need to see a bit more consumer confidence,” Ms Doherty said.
“The rising cost is affecting everyone and households are seeing their energy and food bills rising.
“That knock-on effect is causing serious problems for businesses, particularly independent traders that make up a lot of our membership here in Derry.”
She said it was “vital” the Northern Ireland Assembly returns and takes action.
“It’s never a good time to be without a functioning government and it’s really inexcusable that householders have been abandoned in the current climate,” she said.
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