The Government has been urged by Ibec to consider a last-minute U-turn on the scheduled ending of the 9% VAT rate for tourism and hospitality at the end of this month.
The business representative organisation said the rate should be maintained indefinitely for the sectors, rather than returned to 13.5%.
"Our experience economy is a dynamic sector that encompasses a wide array of industries such as hospitality, retail, travel, food, beverage, tourism, entertainment, arts, events, and activities," said Sharon Higgins, Ibec's Executive Director of Membership and Sectors.
"It contributes substantially to employment in regions that are often harder to reach, serving as a pivotal component of Ireland's economic landscape."
"Despite government interventions in energy cost concerns, businesses across the supply chain continue to grapple with escalating expenses, leading to higher costs for consumers."
Ms Higgins added that an anticipated 12% rise in the minimum wage over the coming year, coupled with pension auto enrolment and other costs would heap further financial pressure on firms.
"For some sectors, with low pension coverage and high living wage levels, these costs may be significantly higher," she claimed.
"By 2026 and 2030, respectively, they could add 13% and 17% to the wage bill in the Experience Economy."
The supposedly temporary 9% VAT rate is due to return to 13.5% on September 1st after the Government extended it for a final time in February.
It made the decision after an economic assessment by Government officials found there was no economic case for extension of the temporary 9% rate.
Government ministers have since consistently ruled out any further extension to the lower rate, because it is considered to be both regressive and costly.
But Ibec claimed it has played a vital role in sustaining businesses and preserving a significant number of the more than 300,000 jobs in the experience economy, which is worth €4bn annually.
