Minister parked Vat rate cut on bikes over worries it would not be passed on by traders

A pre-budget submission said that there was already significant support for bike owners through the Cycle to Work Scheme, which cost €5.5m annually. File photo

Plans for a major cut in the Vat rate that applies to buying bikes were parked over concerns the savings would not be passed on to cyclists.

In pre-budget discussions, Finance Minister Jack Chambers was briefed on Department of Transport proposals to reduce the rate that applies from 23% to 13.5%. However, officials said there was a risk that consumers would not benefit, and retailers might simply increase prices to take advantage.