Wedding Band Association lobby for reduced Vat rate
Wedding Band Association
Letter to the government to reduce the VAT rate to 9%
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Introduction
The Wedding Band Association was established in October 2014. The main objective at the time was to bring like-minded Wedding Bands together to focus on promoting transparent and professional standards within the industry.
Over the years we have built a strong community of professional Wedding Bands. We have put in place group schemes for insurance, conferences, networking, and generated thousands of bookings for our members.
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Impact of Covid 19
The Wedding industry has taken a huge hit due to the impact of COVID 19 Pandemic. Stats published by the CSO year on year show that Ireland has on average over 20,000 registered weddings per annum and it is believed that the industry generates over 800 million euros to the Irish economy.
CV19 will pass and Wedding Bands will get back to filling dance-floors across the country. However, as bands begin to get back to work, they will continue to be faced with the prospect of paying the standard VAT rate of 23%.
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Vat rate reduction
Wedding Bands, Entertainers, Event Production companies, and others alike, currently pay a rate of 23% VAT. The standard rate of VAT is charged on goods and services like Consultancy Services. It is very clear that Wedding Entertainment is a SERVICE, similar to that of photographers and hairdressers – our colleagues in the industry. The ancillary functions of a professional wedding band include, but are not limited to: Administration, marketing, stage building, customer service, and management. This is why we are calling for this rate of VAT to be reviewed and reduced to 9% to coincide with the government stimulus package.
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Benefits on reducing VAT rate
Charging 23% to wedding couples adds no value, they cannot claim it back and it generates a challenging space for full time professional Wedding Bands who adhere to thresholds and vat returns. Unlike corporates, wedding couples are almost never registered for VAT. Wedding Bands are unique in this way IE: There are very few resources that allow to claim back VAT.
Reducing the VAT rate would encourage more bands to register for VAT and not have to seek out loopholes in order to avoid it. It would boost income tax, private pensions, and ultimately deliver more revenue back to the exchequer!
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Thresholds before registering for VAT (which also include benefits for Wedding Couples)
In our category type, the threshold before registering for VAT in Ireland is €37,500. The threshold before registering for VAT in the UK is £85,000.
Although our main objective is to lobby for a reduced vat rate, we also want to highlight the current threshold. This threshold and the current VAT rate deter many Wedding Bands from registering for VAT and pushes them to seek alternative routes to avoid it. For example : Working as an entity where all band members work as self employed and are paid directly by the Wedding Couple. This is another burden on the Wedding Couple as it adds more work load and admin during the Wedding planning process.
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Comparisons
Below are some businesses which operate on the reduced VAT rate of 13.5% and provide a similar wedding related service. See note 14, where it states “certain musical performances” @ 13.5%.
13.5% rate of VAT is charged for:
- Fuel – coal, heating oil, gas, electricity (the rate is 5% in the UK)
- Vet fees
- Building and building services
- Agricultural contracting services
- Short-term car hire
- Photographers (Wedding and Portrait)
- Photobooth
- Florists
- Cleaning and maintenance services
- Catering and restaurant supplies, including vending machines and take-away food (excluding alcohol and soft drinks sold as part of the meal)
- Food Supplements
- Hotel lettings, including guesthouses, caravan parks, camping sites, etc.
- Short-term accommodation
- Cinemas, theatres, certain musical performances, museums, art gallery exhibitions
- Fairgrounds or amusement park services
- Hairdressing services (our industry colleagues)
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Conclusion
Wedding band association and its members are calling on our local councillors, local representatives, and beyond to help us highlight this issue and deliver a detailed document to the government.
We are confident that Wedding Bands are applicable to the reduced VAT rate. The reduction to 9% would be a welcomed start by both parties – The Wedding Band industry and the thousands of couples getting married.
info@weddingbandassociation.ie
TEL: (01) 2549159