Restaurant owners say VAT 'crippling' Manx food & drink industry

Creators of Rum Baba's warn more businesses could close due to rising costs

The owners of a tapas restaurant in Ramsey say VAT is crippling their industry.

The people behind Rum Baba's on Parliament Street announced last week that they would be putting the business on the market citing 'rising costs' and a 'changing landscape'.

You can read more on that HERE.

Owners Sam Kelly and Jess Clague warn if government doesn't 'step up' then more business closures could be on the way.

In a statement to Manx Radio they say:

"The VAT is crippling the industry, I'm not sure people realise that food businesses cannot claim the 20 percent VAT back from our raw food products as they are exempt. It's a crippling industry.

"The cost of living is a vicious cycle, it's now a luxury to eat out and by upping the minimum wage to try help these people, for businesses this added rise & the ladder expected retrospective rises adds even more tax more NI pressures.

"Food costs, Electricity costs, since we opened have gone up almost 40 percent the high street footfall has dropped significantly. So where will this end?

"It's not just hospitality, we recognise and sympathise with all businesses. Unless you provide a service which is absolutely essential or a bill to pay then getting your nails done, your hair cut, a meal out, a taxi home will all be kept pushed back a little more & more as time goes on.

"I have been in this industry now 20 years, I have always wanted my own restaurant it was always the dream. I am utterly disappointed in the lack of support from our government, and although I'm incredibly proud of what we have achieved, we will both leave with new paths ahead."

Manx Radio has invited Treasury to respond.