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Firms refuse to pass on VAT cut

IRISH cinemas, takeaway groups and coffee-shops are reluctant to pass on the VAT cut to customers due to unprecedented economic conditions.

Tax experts have outlined that the reduction of the VAT rate from 13.5pc to 9pc should have resulted in a saving for consumers.

However, VAT specialist, Conor Condon of Taxback.com said that the reaction to the tax change has been mixed.

"Some reduced their prices immediately; others have publicly and blatantly refused to pass the VAT saving to their customers saying they simply cannot afford it," he said.

"In a lot of instances, businesses will not pass on savings on tea or coffee, for example, as the saving is minimum and it costs more to change the pricing."