Mobility Partnership Ireland (MPI), an industry group representing car and bicycle rental firms, has addressed the Department of Finance with concerns regarding the bike rental services in Ireland. They state that these services are operating on narrow profit margins, which is putting pressure on their operations.
In order to offset the burden of overhead costs, MPI is calling for a reduced VAT rate for bike rental services. Two Irish bike rental start-ups, Moby and Bleeper, are also members of MPI.
The trade body expressed their concerns in a pre-budget submission, stating that costs such as staff, insurance, and bike acquisition are higher in Ireland compared to other European countries, and they are continuing to rise. However, customers still expect low prices.
As a result, all major Irish operators, both private and public, are currently facing losses. The commercial operators face greater challenges than public bike sharing schemes like Dublinbikes operated by Dublin City Council, according to MPI.
MPI stated that urgent action is needed to ensure the survival of ambitious start-ups and owner-operated small businesses in the Irish bike hire industry. They are calling for a reduction in the VAT rate to as low as 5%. MPI believes that European Union rules on VAT for green initiatives would allow for such a reduction.
The trade body pointed out that Portugal has reduced their VAT rates on cycle rental services to 6%, compared to Ireland’s 13.5% rate. MPI believes that this reduction acts as a clear signal of support to consumers and encourages the hire of bicycles, ensuring continued low prices.
MPI also recommends the availability of grants for electric bicycle charging infrastructure. They urge the department to provide grants for businesses to install ebike charging stations on their premises.
According to MPI’s submission, such a scheme would boost both ebike ownership and rentals by alleviating consumer concerns about charge range. They believe that workplaces play a crucial role in providing the necessary charging infrastructure, encouraging employees and the wider public to use ebikes through shared schemes or their own ebikes.
Alongside car rental and taxi app firms like GoCar and Free Now, the industry group emphasizes the need for concrete action to reduce transport-related emissions in Ireland. While the Government has focused on COVID-19, inflation, and the cost of living in recent years, MPI believes that it’s now time for specific measures targeting emissions reduction.
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