Belfast Telegraph

Friday 19 December 2014

Restaurant's taxing issue

VAT rates force seafood bar to look south for expansion

The man behind one of Northern Ireland's most successful restaurants says he is being forced to expand in Dublin rather than Londonderry or the north coast because of our high tax rates.

Bob McCoubrey of the Mourne Seafood Bar, which has branches in Belfast and Dundrum, has been looking at sites in the Irish capital where VAT on food is 9% and corporation tax is 12.5%.

In Northern Ireland the rates are 20% and 24% respectively.

Mr McCoubrey says that it's simply "easier to make money" in Dublin.

"I'd love to expand in Northern Ireland. I have seen some fabulous sites, which are real bargains and with my dreamer's head on, they would be fantastic locations for a new place - we'd love to go to the north coast or to Derry for the City of Culture year," he said. "But when you sit down and look at the figures, it just doesn't make sense.

"With the VAT especially, 20% here compared to 9% in the Republic, it's just impossible.

"In France VAT on food is 10%, in Italy, it's 9%, places which are renowned for good food.

"Various agencies are trying to market our hospitality, our food and drink, our agri-food businesses to tourists, but when you're handing over 20% of the sale once you've cooked and served the food, it's not an attractive business proposition for us when we are already paying VAT on some of the raw materials.

"The taxes are also forcing some restaurants - although not ours - down the road of buying in frozen food rather than showcasing local produce, which is farmed more sustainably and which boosts homegrown businesses."

Mr McCoubrey says businesses cannot wait around forever for the issue of devolving tax-setting powers to Northern Ireland to be decided upon.

"We have waited and waited for a decision on corporation tax and it doesn't look like it is going to come any time soon," he said.

"The tax rates we have relate to London and the south east of England. We have a different economy, we rely on tourism and these taxes do not make Northern Ireland a good place to do business.

"The Republic seems much more business-friendly."

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