Budget 2019 'A Mixed Bag' For Irish Retailers: Retail Ireland
In light of today’s Budget, Retail Ireland, the Ibec group that represents the retail sector, has said that while investment in in-work training programmes and further easing of the consumer tax burden is to be welcomed, Budget 2019 will do little to protect the competitive position of the Irish retail sector.
Thomas Burke, director of Retail Ireland, highlighted that the Irish retail sector has come under “a perfect storm of pressures”, including rising costs, e-commerce changing consumer’s shopping patterns, which are likely to be exacerbated by Brexit.
Driving Input Costs
He said that the Government has “largely missed” a unique opportunity to protect a sector which employs so many people across Ireland from these future issues.
“The decision to increase the National Minimum Wage (NMW) to €9.80 in 2019, a cumulative increase of over 13% since 2015, is most disappointing. This increase significantly outstrips the growth in the cost of living which stands at roughly 1% per annum,” he said.
“Today’s announcement is further evidence of the role the State continues to play in driving business costs upwards and will only serve to further increase wage pressures for retailers at levels well above the National Minimum Wage rate.”
He added that Retail Ireland fully supports the additional funding for new and existing apprenticeship programmes and additional investment for Skillnet Ireland, however, he added that retailers had hoped that the Government would have addressed “the need for ring-fenced funding and greater support for the development of modern emerging apprenticeships”.
He highlighted how the income tax package will reduce the burden on average income earners, which will give consumers a little more spending money and will help retailers to attract and retain talent within their businesses.
“Unfortunately, it is not all good news for consumers who will be hit by VAT hikes on certain goods from January 2019,” he continued.
“Categories such as food services and hairdressing will see their VAT rates increased following the Government’s decision to raise the 9% VAT rate band to 13.5%. These categories are struggling under the weight of an increasing cost base and a State imposed increase in consumer prices at this time is most unwelcome.
“It is very disappointing that Budget 2019 hasn’t done more to protect the geographically and socially vital Irish retail sector, as we enter into what will be a very difficult trading period.”
© 2018 Checkout – your source for the latest Irish retail news. Article by Aidan O’Sullivan. Click subscribe to sign up for the Checkout print edition.