The Minister for Finance Paschal Donohoe has confirmed that he has no plans to extend the reduction in the standard rate of VAT beyond its planned expiry at the end of this month.
The rate was reduced from 23% to 21% as part of the July Stimulus announced last summer.
Speaking to the Oireachtas Committee on Budgetary Oversight this afternoon, the Minister confirmed his decision not to extend the reduction, which he had previously outlined in a parliamentary question on 3 February.
The lower rate of VAT for hospitality services was reduced to 9% in the Budget in order to help stimulate activity in the sector that has been badly impacted by Covid-19 restrictions.
Mr Donohoe confirmed that this change will continue to run until the end of 2021 as planned.
"When we made the original decision in relation to the standard rate of VAT there was a particular need to support retailers at a time of great difficulty, and we've launched the Covid Restrictions Support Scheme that is providing addition support to that part of our economy," Mr Donohoe told the committee.
