Budget 2026: Vat cut offers 'far too little, far too late,' says Kerry restaurateur
Ger Counihan of Bunkers Bar and Restaurant in Killorglin, Co. Kerry. Photo By: Domnick Walsh © Eye Focus LTD.
A Kerry restaurateur has hit out at what he called a "disappointing" Budget 2026, warning that the long-awaited cut to the hospitality sector's Vat rate did not go far enough to relieve pressure on an industry already at "breaking point."
Long-time restaurant and bar owner Ger Counihan of Bunkers in Killorglin said the industry has long been ignored and not taken seriously by the government, as rising costs continue to hurt already thin profit margins.
Finance minister Paschal Donohoe announced the Vat rate for the hospitality sector would be cut from 13.5% to 9% as part of Budget 2026, a measure heavily pushed by restaurants and lobby groups since the higher rate was reinstated in September 2023. The cut will come into effect on July 1, 2026, which Mr Counihan said is "far too little, far too late."
"This just shows another broken promise by the Government. We were given assurances that the Vat rate would be reduced in the first 100 days of the Government. It will now be 18 months. That is simply not good enough."
“The cost of everything has gone up, and I mean everything,” Mr Counihan said. “The cost of electricity has doubled in the last year. The cost of water has more than doubled. Staff and product costs are also rising constantly. What was maybe one or two price hikes a year has quickly become three or four, and right now, we’re close enough to breaking point.”
Operating for more than 40 years, Bunkers in Killorglin employs 36 staff in total across full- and part-time and remains open for more than 14 hours a day, seven days a week. As a pub owner in Kerry, Mr Counihan said he also fears for rural pubs in particular, which are often the last business remaining in many towns and villages across the country.
“Pubs are the life and soul of their village, and we see very little respect for that. There is very little sympathy for our trade."
Mr Counihan had hoped to see a 40% reduction in alcohol excise, a measure proposed by the Vintners' Federation of Ireland (VFI), which he says would have helped wet pubs across the country.
"The 40% excise reduction would have helped pubs both small and large across Ireland, but this Government is incapable of thinking outside the box. Nothing in this budget will help small pubs that do not serve food."
“It's not that the Vat reduction doesn't go far enough, it's that it doesn't go anywhere. We have minimum wage hikes and the roll-out of pension auto-enrollment coming in January. We have been given one cost reduction next summer to offset two cost hikes in the new year.
"It only serves as a headline, it is a waste of space," said Mr Counihan.
"We are not looking for handouts, we just want what is fair, and a 40% excise reduction would have only given us a chance to survive."
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