Finance Minister Paschal Donohoe’s second Budget has been unspectacular – but it is what is absent from his package which has attracted most criticism.

While there was an expected small benefit for those on social welfare and taxpayers, the biggest measure was the rise in VAT.

It won't just affect hotels. It will also impact cinemas, hairdressers, museums, art galleries and short term guest accommodation.

The VAT increase, from 9% to 13.5%, for many sectors will raise €466m.

In total the additional expenditure in the Budget, beyond pre-committed spending, is €1.5bn – almost a third of that has come from the increase in VAT.

In the Dáil chamber the opposition to the rise in VAT has been muted. But outside Leinster House hotels and restaurants have predicted that the increase will push some firms out of business.

It may also have an inflationary effect.

The Government argues the hospitality sector has benefitted from a low 9% VAT rate temporarily introduced during the downturn. Now the economy has rebounded, the time for that incentive is over.

The other notable feature of the Budget is the absence of new measures on carbon tax.

It comes one day after the Intergovernmental Panel on Climate Change special report which served as a warning about the damage being created by rising emissions.

Ireland is already far behind other EU countries in meeting its commitments on climate change.

Critics say the Budget was a missed opportunity for the Government to provide leadership on the issue.

The Environmental Protection Agency has warned the country could face fines of €455m in 2020 for missing EU targets on emissions.

But clearly the Government is worried about the impact a rise will have in some sectors of the economy which are heavily dependent on diesel such as farming and road haulage.

Lobby group the Environmental Pillar said: "The Government has clearly gone in a disappointing direction".

But behind every Budget is the story of the public finances.

While Minister Donohoe has managed to balance the books for the first time since 2007, absent from his Budget was significant progress in addressing Ireland’s mountain of debt.

The gross national debt will be €209 billion next year.

Ireland is currently paying €16.5m every day in interest. That is a whopping €6bn a year.

To put in context, the entire budget for the Department Housing – which is tasked with fixing the homelessness crisis - is €4bn.

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