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Published: July 24, 2020

Ireland Cuts VAT Rate by 2% to Lower Costs for Consumers

The Irish Tax authorities will be allowing a temporary VAT Rate cut from 23% to 21% between 1 September 2020 to 28 February 2021 as part of their July stimulus package announcement.
Ireland tax cut

In their July stimulus Package announced this week, the Irish government has dropped VAT rates and introduced new measures to boost the economy in the midst of the COVID-19 pandemic. 

The VAT rate on goods and services will be cut from 23% to 21% from 1 September 2020 to 28 February 2021. The cut is aimed at decreasing the costs of purchases such as food, alcohol, clothes and motor repairs for Irish consumers. 

Breakingnews.ie reported that Chartered Accountants Ireland has said that the July stimulus is “not a handout; it is an investment in national recovery”.

They welcomed the decrease in VAT from 23% to 21% saying the reduction will aid the retail, service and hospitality sectors in particular (source). 

However, the Irish Tourism & Hospitality industry believes the package is a “cold comfort” to the thousands of hospitality businesses still struggling. 

  • Original article was published by our sister company Vat Global which can be read here
  • For more Covid-19 related VAT updates, please visit our dedicated COVID-19 news centre here

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