Dáil Éireann Debate, Tuesday - 21 April 2026
261. Deputy Ged Nash asked the Tánaiste and Minister for Finance his Department’s up-to-date estimate of the cost of the reduced rate of VAT for the hospitality sector for the remainder of 2026; the estimated full year cost for 2027; if he will review this decision in light of the rising cost of fossil fuels and given the need for additional targeted supports for households and business; and if he will make a statement on the matter. [26422/26]
Amharc ar fhreagraI am advised by Revenue that the cost of the reduction in the VAT rate from 13.5% to 9% for the food and catering sector, as announced in Budget 2026, and to commence from 1 July this year, is estimated at €216m for 2026 and €632m for a full year (i.e. 2027).
This measure implements a commitment in the Programme for Government to support SMEs through changes to VAT, with the hospitality sector being specifically referenced. The decision reflects the Government’s commitment to supporting employment in sectors that are highly labour-intensive and form a key part of the domestic economy. The reduction in the VAT rate to 9% is expected to support over 150,000 jobs across the country.
The Government is acutely aware of the rise in energy costs owing to the disruption of energy supplies from the ongoing conflict in the Middle East. To address this, the Government has brought forward two packages of measures at a combined cost of some €750 million. These measures include temporary reductions in fuel excises, the reduction in the NORA levy, the extension of the fuel allowance, the enhancement of the Diesel Rebate Scheme and new schemes to be established by the Department of Agriculture and Transport, respectively, to support farmers, agricultural contractors, fishers, hauliers, bus operators and others.
