Irish News

Wednesday 23 July 2014

'Mail' rapped for not passing VAT cut to readers

Edel O'Connell

Published 08/07/2011|05:00

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A GOVERNMENT TD last night criticised the 'Daily Mail' for refusing to pass on the Government's VAT reduction to its readers.

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Labour TD Aodhan O Riordan described the move as "a slap in the face to Irish consumers".

Sales tax on restaurants, hotels, cinemas, newspapers and tourism-related activities fell from 13.5pc to 9pc on July 1 in a move aimed at stimulating growth in the retail and tourist industries.

There is no obligation on the affected industries to pass on the savings -- however businesses were encouraged by the Government to cut their prices.

Independent News and Media led the charge by cutting the price of the Irish Independent by 5c last Friday.

However the 'Daily Mail' has refused to follow suit.

Taoiseach Enda Kenny said this week that businesses in the sector to which the new lower VAT rate applied would be "failing Ireland" if they did not pass on the reduction.

However, the Minister for Jobs, Enterprise and Innovation Richard Bruton yesterday refused to comment on the decision by the 'Daily Mail'.

Labour TD Aodhan O Riordain said: "I really think the 'Daily Mail''s refusal to pass on the Government's VAT cut represents a real slap in the face to Irish consumers. It is estimated the 'Daily Mail' will save approximately €750,000 as a result of this decision.

"However, these savings will be sent back to their base in the UK, so I believe it is disgraceful there will be no benefit to Irish consumers," he said.

"This cut was intended to spur growth in two industries that have been hit hard over the course of this economic downturn and it is a really disappointing that some businesses are not playing their part after the Government took this course of action," he added.

Chairman of the Consumers Association of Ireland Michael Kilcoyne has described the decision as "absolutely appalling".

"The purpose of the VAT reduction is not to give an increase in profits to the Daily Mail General Trust by not passing on the savings to the consumer. It is absolutely appalling they have chosen to keep the savings for themselves. It is very disappointing," he said.

In a statement the editor of the 'Irish Daily Mail' and 'Irish Mail on Sunday' Eric Bailey claimed the newspaper had decided not to pass on the VAT reduction to customers as it had not increased its price in almost three years.

Irish Independent

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