Hair and beauty sector calls for more support
THE Hair and Beauty Industry Confederation (HABIC) has written to the government to highlight the devastating impact of Covid-19 on the sector across every county in Ireland including Mayo, where there are 748 people employed in 276 hair and beauty salons.
It outlined the key supports needed to ensure the future sustainability of the sector where many businesses are challenged to remain as a viable going concern and which are further challenged by a huge increase in black market trading.
It said the impact on trading and the many small business in the sector throughout Ireland has been very serious.
Salons and operators have not been allowed to open yet in 2021 and in 2020 were closed for 22 weeks in total, almost half of the year. The year on year comparison for 2020 against the previous years’ trading shows a stark impact of the virus.
Margaret O’Rourke Doherty, CEO of HABIC, said: “While we recognise public health and safety is the priority, our sector has been disproportionality penalised. Since the outbreak of Covid-19 and from a total of 6.8 million services, there have only been seven outbreaks identified in the sector.
“We have outlined a number of measures that will have the dual impact maintaining a viable sector and at the same time protecting taxpayers in the face of a burgeoning black market trade.”
“Our members account for thousands of employees with a significant presence in every town and village in Ireland who provide an essential service to the community. This is a crucial time for the sector and the communities who we provide our services to. It is essential that we are allowed to properly trade into the future,” she said.
A report from economist Jim Power also highlighted the impact of the pandemic on the sector and the numerous measures required to ensure it is sustained into the future.
The economic value of the sector in 2019 was €2.624 billion, but this fell to €1.740 billion in 2020.
In 2019 the industry provided 30,800 jobs and 18,480 indirectly. These numbers reduced to 27,000 direct jobs and 16,200 indirect jobs in 2020. Those numbers continued to decrease.
In order to support the hair and beauty industry, HABIC wants the 9% VAT rate to be made permanent.
It also said the government needs to extend the lower VAT rate to the beauty sector, saying this would help the legitimate operators compete against the non-legitimate operators and undermine the black economy in beauty and hairdressing services.
It also suggests that a "stay and spend" type scheme should be introduced and which would only apply to registered legitimate businesses.
By giving a tax credit to customers, clients would be enticed back to the salons which would provide support to struggling businesses seeking to re-build; and it would help divert business away from non-legitimate operators who make no contribution to the Exchequer.
The scheme should not be made available until eight weeks after the salons are allowed re-open, it added.
It also said that the EWSS scheme should remain in place for the hair and beauty sector until at least the end of 2021, and possibly to the middle of 2022, depending on the evolution of the Covid-related restrictions on the sector.