Take advantage of the second Reduced VAT RateWednesday, 06 July 2011 Get Value from the VAT ReductionThanks to the second Reduced VAT Rate in Ireland I saved 5c on my coffee this morning. While 5c a day is hardly big news, it got me thinking, how could gift cards help businesses benefit from the reduced VAT rate? The new lower VAT rate has been introduced in respect of certain goods and services (mainly related to tourism) for the period 1 July 2011 to 31 December 2013. Below are just some of the services that fall under the new 9% VAT rate’s umbrella.
Not only are your gift cards the perfect gift, but now they go further for the recipients too, 4.5% further to be precise. In the hospitality sector many choose to sell their gift cards as an “experience card”, well now you can highlight that the “experience” just got cheaper; or even add something else small to the “experience” to make it more attractive!
You could use the cards to reward customers for dining in your restaurant, getting their hair cut or styled in your salon or staying in your hotel for example spend €100 and get a gift card for €10 absolutely free. With the savings they make from the new VAT rate and your added incentive they’ll surely come back soon!
This brings me back to my coffee.... which incidentally I paid for using a spending/budgeting card (gift card under a different alias). How does it work? I top-up my card every now and again and then spend to my heart’s content. With the 5c saving every day I might even afford a muffin pretty soon!
MS
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