The group is urging the Government to reduce business taxes to ease pressure on pub owners.
It warned that many pubs across Ireland currently risk closure due to soaring costs, adding that many pub owners are struggling to break even.
VFI pointed to rising labour costs, an increase in energy costs and water, as well as high taxes as the main factors challenging the sector.
Chief executive Pat Crotty said the pub trade is at a “breaking point”.
“Without meaningful government intervention, we will see a wave of closures that will impact communities across the country,” he said.
“Publicans need long-term support, not just one-off schemes, to navigate these unprecedented challenges.”
Recent research from the VFI found that the Government takes €1.77 from each pint sold, while the drink supplier receives more than €1.50.
Staff costs are around €1.41, while pubs must also pay for overheads such as insurance and TV sports subscriptions.
This leaves the average pub owner with just 17c, according to Mr Crotty.
The VFI is calling for a reduction of 7.5pc in excise duty in order to allow publicans to cut prices and increase margins.
The group is also urging the Government to pause the move to a living wage.
The Government looks likely to boost the national minimum wage by over €1 per hour in Budget 2025.
The Low Pay Commission is understood to have recommended increasing the rate to at least €13.70 an hour, according to reports last month.
Its proposal would help the Government deliver on a commitment to replace the minimum wage with a new living wage in two years.
“The current economic climate does not allow for such a significant increase in labour costs without risking widespread job losses and business closures,” the VFI said in a statement.
It is also demanding that the Vat rate for hospitality drop to 9pc to maintain affordability for customers, as well as a reduction in employer’s PRSI.
A decrease in the standard Vat rate from 23pc to 21pc would support a drop in operational costs for pub owners, the group said.
“We need a clear commitment from the Government that they understand the scale of the crisis facing our industry and will take decisive action to prevent the collapse of our cherished pub culture,” Mr Crotty said.