Ireland has shown readiness to lift some tax cuts and to raise the value added tax (VAT) in tourism, but just after getting clear picture of the effects of Brexit, released the Finance Minister Paschal Donohoe. The reduction of taxes for hotels, restaurants and other tourism activities from 13.5% to 9.0% in 2011 have revived the sector since the financial crisis in Ireland. The country is now reporting a record growth in tourist visits and higher prices, especially in Dublin.
Although the number of tourists has increased by 2.5% this year, weakening British pounds after the Brexit referendum has cut tourist trips of Ireland by 7%, while in previous years, their numbers have seen double-digit growth.
That made Paschal Donohoe retain the lower tax in the 2018 budget, presented yesterday. However, such decrease drew attention to the sharp increase in the state fee on commercial property, which is another area that has been restored after the rate has fallen, indicating its future intentions.
“We will decide on VAT when we become more aware of what is happening in the British tourism sector after Brexit”, said Paschal Donohoe.