Plan to cut Vat rate to 9pc for hospitality and services sector as deal to form new government reached

The food and hospitality sector has long called for the lower 9% VAT rate to be reinstated as they claim operating costs for produce, wages and energy bills have risen with inflation in recent years. It’s a response to challenging economic circumstances that have been complicated by a significant increase in costs.

Agreement has now been reached between Fianna Fail and Fine Gael to return to the lower 9% VAT rate as part of the Budget process, providing a crucial lifeline to businesses in the hospitality sector that struggled during the pandemic.

The impact of this decision will be closely monitored by the new Finance Minister, expected to be Paschal Donohoe, as this restoration is seen as a vital step towards economic recovery and sustained growth in the food and hospitality sector.

The negotiating teams in Fianna Fail and Fine Gael have ended their discussions with the Regional Independent Group, setting the stage for a new government that reflects a consensus on supporting key economic areas, particularly in response to ongoing inflation.

Read at Irish Independent