In late July, the Irish Government announced its updated stimulus package for businesses. It included a number of initiatives around employment and wage subsidies, grants, loans and tax cuts. One of the measures announced is a temporary reduction in the standard VAT rate in Ireland.
What is the change?
- The standard rate of VAT in Ireland has been reduced from 23% to 21%. This change comes into effect from 1st September 2020
- It is a temporary reduction, lasting for a six month period until 28th February 2021
- The change will not impact the VAT treatment of supplies that qualify for the reduced rate of VAT, which remains at 13.5%. This includes many activities in the tourism and hospitality sector
Further guidance on the scope of this relief can be found on the government website – please keep checking the Gov.ie website for further updates.