Ireland: VAT rate to increase for tourism and hospitality sector effective 1 September 2023
The VAT rate that applies to certain goods and services—mainly in the tourism and hospitality sector—will increase from 9% back to 13.5%
VAT rate to increase for tourism and hospitality sector effective 1 September 2023
The rate of Irish value added tax (VAT) that applies to certain goods and services—mainly in the tourism and hospitality sector—will increase from 9% back to 13.5%, with effect from 1 September 2023.
The types of goods and services affected by the VAT increase include:
- Supplies of certain food and beverages in restaurants, take-aways and other catering establishments
- Admissions to certain attractions including cinemas, museums and exhibitions
- The provision of hotel, guesthouse and similar accommodation
- Hairdressing services
The temporary 9% VAT rate for these supplies came into effect on 1 November 2020 in response to the challenges faced by these sectors as a result of the coronavirus (COVID-19) pandemic. Its expiry date was extended on several occasions, but the government had indicated that there would be no further extensions beyond 31 August 2023.
Supplies of certain printed matter including magazines and periodicals and the provision of sporting facilities by profit making bodies, which also qualify for the 9% rate of VAT, are not affected by this change, nor are goods and services subject to other rates of VAT affected.
Businesses that supply the types of goods and services mentioned above will need take steps to provide that they apply the 13.5% rate of VAT to those supplies from 1 September 2023 onwards.
While this VAT will not become due to Revenue until 23 November when they file their September/October 2023 VAT return, businesses need to nonetheless take steps now to provide that they are commercially protected and are compliant with the new requirements.
Read an August 2023 report prepared by the KPMG member firm in Ireland
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