Irish hairdressers are giving urgent warning of a major price hike affecting prices in WEEKS

Hair salons have urged the government not to break their reduced VAT rate.

Clippers called for the sector’s VAT rate to remain at nine percent ahead of its planned increase in the coming weeks.

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The rate is set to rise to 13.5 percent on March 1.

But the Irish Hairdressers Federation branded the VAT hike plan as “unfair” as salons have already been hit by a dramatic rise in costs over the past year.

And the association, which represents over 500 salon owners nationwide, warned that the upcoming sales tax hike would “ruin” many businesses.

The representatives revealed how the VAT increase will mean that prices may have to go up, which will lead to fewer customers.

IHF President Danielle Kennedy stressed that an increase in VAT would cripple many businesses at a time when salons are struggling to get back on their feet after the pandemic restrictions.

She said: “The reality is very simple for hair salons in Ireland, this VAT hike is going to ruin them.

“Barbershop costs have skyrocketed over the past year as they struggle to get back on their feet after Covid.

“This will increase the cost of hair salons even further, meaning salons may have to raise prices, which means fewer customers, which means even more pressure.

“For example, electricity costs have doubled in many cases compared to two years ago, which is already killing hair salons.”

About 25,000 people are employed in the hairdressing industry and Ms Kennedy insisted the government’s decision to increase the VAT rate was “nonsensical”.

She said: “You must ask if the minister [for Finance] is in touch with reality as it makes no sense for the government to do so at a time when small businesses are struggling more than ever.

“This sector employs 25,000 people, many of whom work in saloons on the main streets of small towns and villages.

“Hair salons are a big part of their communities and provide an important service, especially to older people who don’t feel comfortable going out in public without their hair looking good.

“Government policies cannot consistently reward large multinationals while increasing costs for small businesses that employ people in their communities.”

IHF federation vice-president Lisa Eccles also warned that the VAT increase will lead to job losses in the industry as many salons will have to close.

She believes there will be a push towards the informal economy, which will ultimately cost the tax authorities in lost taxes.

She said: “I can of course only speak about my own salon and since 2018 I would say my prices have gone up 15 per cent and to be honest it’s not even to make a profit it’s literally just a Try to keep it the doors open trying to stay afloat. And it barely cuts it anymore.”

And Rossa Danagher, who runs salons in Donegal and Sligo, said he has already been forced to raise prices by 15 per cent.

He said: “We actually have to explain to every customer why we did it. We actually apologize because we take it so personally, we have a personal relationship with these people that come into our salons weekly.

“So it’s hard for our industry and unfortunately we can’t cover that VAT, it will go back to the consumer that comes through the door.”

He warned, “This sales tax hike will indeed be the last straw for many salons.”