Tourism and hospitality VAT rate will move to 9% on Sunday

business
The measure is designed to help the tourism and hospitality industry which has been heavily impacted by the Covid-19 pandemic
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Digital Desk Staff

The VAT Rate for the tourism and hospitality sector will drop from 13.5 per cent to 9 per cent from Sunday, 1 November 1st, as announced in Budget 2021.

This rate reduction will apply to catering and restaurant services, tourist accommodation, cinemas, theatres, museums, historic houses, open farms, amusement parks, certain printed matter, and hairdressing. This change will apply from November 1st, 2020 to December 31st, 2021.

Speaking in advance of the change Minister for Finance Paschal Donohoe said: "I introduced this change in recognition of the unprecedented challenges facing particular sectors of the economy. The reason I chose a start date of November 1st was to introduce this measure at the earliest possible moment to allow those businesses that are currently open to benefit.

“I understand that many businesses remain closed for now and those that are open are operating at significantly reduced capacity. I am putting this reduced rate in place until December 2021 in order to provide significant additional support to businesses throughout 2021 when hopefully our economy and society can start to return to some form of normality.

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“This measure represents targeted, timely and temporary support to those areas of the economy most deeply impacted by the public health restrictions.

“The introduction of a 9 per cent VAT Rate for the tourism and hospitality sectors alongside other measures such as the Employment Wage Subsidy Scheme and the Covid Restrictions Support Scheme forms an important part of the Government’s economic response to the pandemic.”

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