Members of the Lithuanian Hotel and Restaurant Association (LVRA), trying to find the right product to name the customer's purchasing power, chose zeppelin, a symbol of Lithuanian cuisine. Thus the Zeppelin Index (CI) was born. And his changes at the moment, according to the association, do not bode well.
According to "Creditinfo", 7025 are currently operating in Lithuania restaurants and cafes. They employ more than 37 thousand people. people. Although both the number of restaurants and the number of employees working in them grew compared to last year, and revenues rose from 1,7 billion to 2,1 billion euros, the restaurant business is still not recovering from the pandemic and the financial obligations assumed during that period, which amount to 55 million. Eur, according to the association's statement.
Currently, 41 percent catering companies still belong to the high and highest late payment risk groups. 27 percent belongs to both the high and the highest bankruptcy classes. 66 restaurants have already gone bankrupt this year, and the most difficult season related to the increase in heating prices is still to come. However, the biggest risk for the entire sector is the planned increase in VAT starting from the new year, which currently stands at 9%.
According to changes in consumer prices, the prices of food and non-alcoholic beverages in stores rose by 30 percent, and in restaurants by only 15 percent. LVRA emphasizes that few people take into account that for the public catering sector, utility taxes increased by 125 percent in two years, raw materials by 51 percent. , wages are 25 percent, when wages in restaurants make up to 33 percent. meal costs. The growth of all these ingredients makes the food on our plates more expensive. In the fierce competition of the restaurant business, raising the price can only happen when there is no other way out.
In order to estimate the real purchasing power of people, LVRA uses the Zeppelin Index. CI is the amount of dickukul portions that people can buy with their salary. As average wages and prices rise, this index shows how people's purchasing power changes.
From an eight-year perspective, everything seems to be fine. The restaurant business is slowly recovering from the COVID-19 epidemic, but the energy price crisis threatens to destroy the sector this year. Not only that, the government intends to no longer apply the two-year 9 percent tax to the public catering sector from next year. VAT benefits, which at least partly compensate for the rapidly rising costs of energy, labor and raw materials. If the VAT relief is abandoned, the price of zeppelins will increase by at least 20 percent next year, notes LVRA.
"We calculated that if the VAT relief is refused, the prices of meals will become significantly more expensive next year, so we are once again appealing to the Government and the Seimas, asking for an extension of 9% for at least another year. Validity of VAT relief. This solution would at least partially amortize the declining purchasing power of the average consumer. I understand that many people will consider the "Zeppelin index" ironically and we do not claim to be an academic study, but believe me, behind these numbers lies a real threat to catering establishments losing visitors and going bankrupt", says the head of the association Evalda Šiškauskienė.
In most (22 out of 27) EU countries, reduced VAT is applied to the catering sector. In some countries, the reduced VAT rate is applied permanently. Data from European countries show that a preferential VAT rate for catering services is the most effective tool to help the sector most affected by the COVID-19 crisis.
ELTA (ELTA)
