According to a report by DN, the government's measure will not impact restaurants that are concerned about the loss of consumer purchasing power and the increase in costs, with associations and entrepreneurs asking for a VAT reduction to help the sector.
Despite the fact that 44 products in the essential food basket will be exempt from Value Added Tax (VAT). For restaurants, the proposed law presented by the government will have virtually no impact on their bills.
"We still have to see how our suppliers are going to behave with this change in VAT, but I believe that we will achieve reductions of up to 1.5%", says Sérgio Frade, owner of the Lisbon restaurant "O Frade". Chef Fábio Alves, who leads the kitchen at "SUBA", also predicts that the savings will be just 1% while stating that this measure "is a drop in the ocean to combat all the increases that the restaurant sector has endured in the last year".
"The 44 products that were exempt from VAT are a very small portion of a whole range of products that we use. In our case, they are not even those that represent the greatest expression in our monthly bills", he explains, adding that it will not be possible to cut the costs for customers.
The Portuguese Hotel, Restaurant and Similar Association (AHRESP) has asked for specific measures for this sector, reiterating to the government the request to lower VAT on catering. "The temporary application, for one year, of the reduced VAT rate on food and beverage services is essential. With this measure, companies will be able to have cash to settle their obligations, but also to continue their effort to increase wages, so important for increasing the purchasing power of families", explains the general secretary of the association.
Ana Jacinto added in the DN report that zero VAT is intended for the final consumer and will have little impact on companies. "For example, a restaurant owner currently buys these essential foods at a VAT rate of 6%, and then transforms this raw material to sell the final product at a rate of 13% of VAT, you will pay the State the difference between the VAT on your sales and the VAT on your purchases. With 0% VAT, you will no longer pay VAT at the time of purchase, but then you will have to deliver all the VAT upon sale. In other words, there are no savings for our companies, because VAT is not a cost", she concluded.