The Northern Ireland Food To Go Association has renewed its call for Northern Ireland to become the UK’s first hospitality VAT pilot region, arguing that the case for reform has never been stronger as businesses continue to face unprecedented cost pressures and increasing competition from across the border.
The call comes as more than 200 hospitality businesses have closed across Northern Ireland since January 2026, highlighting the severe challenges facing independent small to medium sized operators and the growing urgency for meaningful intervention.
Michael Henderson, Chief Executive of the Northern Ireland Food To Go Association, said:
“For more than a year, the Northern Ireland Food To Go Association has been leading the campaign for VAT reform in Northern Ireland, producing a dedicated policy paper, engaging directly with Ministers and consistently calling for Northern Ireland to become the location for a hospitality VAT pilot.
“We welcome the growing support for VAT reform from across the hospitality industry and beyond. It is encouraging to see wider recognition of the challenges facing businesses and the opportunities that VAT reform could unlock.
“However, Northern Ireland faces a challenge unlike any other region of the United Kingdom.
“Our businesses are competing every day against operators in the Republic of Ireland where hospitality VAT rates are significantly lower and where further reductions continue to be discussed. That places independent businesses across Northern Ireland, particularly those in border communities, at a significant competitive disadvantage.
“More than 200 hospitality businesses have closed their doors this year alone. Many of these are independent operators serving local communities, employing local people and supporting local supply chains. The reality is that rising labour costs, National Insurance increases, energy bills, food inflation and business rates pressures are becoming increasingly difficult for businesses to absorb.
“We cannot continue asking local businesses to compete with one hand tied behind their back.
“The Northern Ireland Food To Go Association has long argued that Northern Ireland is uniquely positioned to demonstrate the economic benefits of VAT reform. A dedicated pilot would allow government to properly measure the impact on business growth, job creation, investment, consumer spending and high street regeneration.
“We were encouraged to see the Finance Minister and Economy Minister jointly raise the prospect of a VAT pilot with HM Treasury. That reflects the growing momentum behind a proposal that NIFTGA has championed for some time.
“The food-to-go sector employs thousands of people in every town, village and city across Northern Ireland. Independent cafes, coffee shops, sandwich bars, delis and takeaway businesses are the backbone of local communities, creating jobs, supporting local suppliers and contributing significantly to the local economy.
“This is not about seeking special treatment. It is about creating a fairer and more competitive environment for Northern Ireland businesses.
“The case for a Northern Ireland VAT pilot has never been stronger. We will continue working constructively with Ministers, elected representatives, industry partners and HM Treasury to secure meaningful action that protects businesses, supports investment and helps create a level playing field for our sector.”