Budget to confirm increase in 9% VAT rate for hotels, restaurants

Staff Reporter


Staff Reporter


Budget to confirm increase in 9% VAT rate for hotels, restaurants

The battle to prevent an increase in the 9% VAT rate for hotels, restaurants (and hairdressers) looks certain to have been lost and an increase to 13.5% is to be confirmed to day when Minister for Finance Paschal Donohoe announces  tax and spending measures for next year's Budget in the Dáil today.

God news will include a €5 increase in social welfare payments and a reduction in the 4.75% rate of the USC.

The point at which people hit the higher rate of income tax will also rise by €750.

PRSI benefits for the self-employed will be extended to include jobseeker's benefit in late 2019.

Two weeks' paid parental leave will also be introduced late next year.

Other tax measures include a €10,000 increase in the threshold for inheritance tax, which applies to children inheriting from their parents.

The main spending increases include a €300m affordable housing scheme over three years, €55m in additional funding for mental health and an extra €20m for the National Treatment Purchase Fund.

Free GP care is expected to be extended to 100,000 people as a result of a €25 increase in the income threshold for the GP card.

16,000 children are set to qualify for the highest levels of childcare subsidy due to almost €90m in additional funding.

The 9% VAT rate for hotels, restaurants and hairdressing will be increased to 13.5%.

There will be an increase of 50 cent in a packet of cigarettes but there will be no increase in the carbon tax.