The Irish Department of Finance has confirmed that the reduced 9% VAT rate for food and catering services and hairdressing services became permanent on 1 July 2026. The change replaces the previous temporary measure and establishes the reduced rate without an expiry date.<\/p>\n
The announcement includes the following key points:<\/p>\n
The VAT rate for food and catering services and hairdressing services has been permanently reduced from 13.5% to 9%, effective 1 July 2026.<\/p>\n
Hotel accommodation remains subject to the standard 13.5% VAT rate.<\/p>\n
The 9% VAT rate applies to food and catering services provided by hotels.<\/p>\n
The permanent rate was announced as part of Budget 2026 and is consistent with the Government\u2019s Programme for Government commitment.<\/p>\n
According to the Department of Finance, more than 99% of businesses operating in the affected sectors are small and medium-sized enterprises (SMEs), with more than half classified as microenterprises employing fewer than ten people. The government also stated that approximately 85% of the financial benefit of the measure is expected to be received by SMEs.<\/p>\n
The permanent reduction replaces the previous temporary arrangement and establishes the 9% VAT rate as the ongoing rate for the qualifying services.<\/p>\n