Cathal Crowe (Clare, Fianna Fail)
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47. To ask the Minister for Finance if he will fully outline his plans to reduce the VAT rate applicable to food-based hospitality, entertainment and hairdressing; and if he will make a statement on the matter. [4853/25]

Paschal Donohoe (Dublin Central, Fine Gael)
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As the Deputy will be aware, in making any decision in relation to VAT rates or other taxation measures, the Government must balance the costs of the measures in question against their impact and the overall budgetary framework.

In recognition of the needs of SMEs in the hospitality sector, the Programme for Government does commit to bring forward measures to support SMEs, in particular in the retail and hospitality sectors. It acknowledges the increased cost pressures on these sectors and states that this will entail changes to VAT, PRSI and other measures.

The Programme makes it clear that these measures will be implemented as part of the normal budget process. This process will consider the timing of any VAT change as well as its scope.

The Government is very conscious of the pressures being faced by businesses in the hospitality sector which is why it provided for a 9% VAT rate from 1 November 2020 to 31 August 2023 at a cost of over €1.3 billion.

Apart from VAT measures, recent budgets contained a number of measures to support businesses facing increased costs, including the Increased Cost of Business grant in Budget 2024 and the Power Up Grant of €4,000 in Budget 2025.

In addition, it should also be noted that the most recent income tax package, increased Consumer's purchasing power, which should help boost spending in the food based hospitality sector.