Yvonne Ingham, Jeanette Hannon and Tainara Lescoski Ribeiro from Days Bazaar with Minister Peter Burke and Adrian Cummins, Restuarant Association of Ireland, this morning, Monday.

Reduction in VAT comes into effect this week

Published: Mon 29 Jun 2026, 1:47 PM

Last updated: Mon 29 Jun 2026, 2:05 PM

This week the Irish government will implement a permanent reduction on the VAT rate on food, catering and hairdressing services from 13.5% to 9%.

On a pleasant summer morning the CEO of the Restaurants Association of Ireland, Adrian Cummins, took a seat outside Days Bazaar, Mullingar, last Monday, June 29.

The chief of the representative body for the Irish restaurant, café, and hospitality sector was on hand for a photo call ahead of the implementation of the 9% VAT rate for the hospitality sector on July 1.

“We're here this morning at Days Bazaar in Mullingar, where we are launching our thank you to the government with regard to the 9% vat rate,” Mr Cummins said, “This is a huge support for our industry, support for small business, cafes, restaurants, all the businesses that serve food across the state.”

The Restaurants Association of Ireland believe the tax adjustment is crucial for the viability of many businesses: “Our industry has seen so much upheaval over the last number of years. The cost of business has increased. This 9% vat rate will give huge support for many, many businesses that are in food service, where their margins are so wafer thin. It will give them stability in the future.”

The Minister for Enterprise, Tourism, and Employment, Peter Burke emphasised the importance of the move: “This will support the growth of local businesses from your local cafes, to local restaurants, and local hairdressers.

“Many of the businesses you see on the main streets of our towns and villages and this will be key in growing jobs. It's aligned with our tourism policy, A New Era for Irish Tourism, which is looking for a 7% growth per annum in jobs and revenue, which will be very important. Critically this measure will bring viability into businesses. It's 4.5% under the margin and we're saying for that 4.5% we need 7% growth,” Minister Burke said.

The 9% VAT rate for the Irish hospitality sector applies specifically to food, catering, and restaurant services, dropping from 13.5%. Unlike previous temporary rate cuts during the pandemic, accommodation (hotels, B&Bs) does not qualify and will remain at 13.5%.