Reduced VAT rate for the hospitality sector

Oct 13, 2020

From 1 November 2020 to 31 December 2021, the tourism and hospitality sector will benefit from a temporary cut in the rate of VAT from 13.5 percent to 9 percent. The estimated cost of this measure is €401 million for the time period of the reduction (€336 million for calendar year 2021). According to the Minister’s speech, this will allow those businesses that are currently open in this sector to benefit.  

The reduced 9 percent rate was previously in place from July 2011 to 31 December 2018. On 1 January 2019, the rate reverted back to 13.5 percent, with the exception of newspapers, e-books and the provision of sporting facilities.  

A reduced rate of VAT for tourism and hospitality was a recommendation of this Institute in its Next Financial Year position paper.  

Standard VAT rate  

The Minister also announced that from 1 March 2021, the standard VAT rate of 21 percent will revert to 23 percent.