The Reason Behind This Blog

"Ireland's minister of finance announced that a new reduced 9% V.A.T. rate will be introduced from 1.7.2011 to 31.12.2013.
The reduced rate will apply, inter- alia, to restaurant and catering services, hotel accommodation, admission to cinemas, theatres and certain musical performances, museums and art galleries admission, amusement parks, hairdressing services and printed matters such as maps and leaflets.
The measure will be provided for in the forthcoming finance bill 2, 2011."

So I was talking with some friends about this new tax rate introduced in Ireland on July 1st. Effectively it means that certain shops and services have had the VAT reduced from 13.5 % to 9%, a reduction of 4.5%. This reduction has the intention of lowering the cost of certain things to encourage spending in the community and hopefully kickstart the economy again.
This 4.5% reduction in VAT is a double edged sword however as the tax reduction means less money is going to important services like Hospitals, Healthcare, Education etc etc. However it is hoped that more spending and more business will mean that overall the tax takings will actually rise.
well that's if businesses actually pass this saving on to their customers but surely they would wouldn't they?
When my friend told me about going to the cinema 2 nights ago (the 5th of July) I asked him did he notice any price difference in the tickets as Cinemas are covered under the entertainment services of the new tax rate. He said no and that they had been charged the same price as always and as he didn't know at the time he didn't bring it up with the staff or manager.
I decided then to look into this a bit more. I rang the cinema thinking that maybe they didn't know that the change affected them (hey its tax its not the easiest thing in the world). When I asked them however if they had reduced their prices in accordance with the new tax rate implemented July 1st I was met with an abrupt NO, taken aback I asked were they going to implement it in the near future? again I was told NO. and when I pushed further and asked if they were ever going to implement it I was told NO again. no reasons of why just NO.
Inspired by this shear brazen act of profiteering at the countries expense really I wondered was there any other places in Letterkenny that were doing the same thing so I began ringing every restaurant, hotel, hairdresser pretty much everything that falls under the new rate and asked them had they changed their prices accordingly.
This blog shows what I found.