While it was some bit of a surprise that carbon tax wasn’t increased in this budget, I don’t think the abolition of the 9% tax rate for the tourism industry came as a surprise. This has been flagged for years now and eventually the government decided that this industry has had enough favourable treatment. It’s a shame really for those outside the big cities as those are the ones who really need it. However the hotel industry can’t really blame the government for this and must look closer to home. Room rates have increased substantially in the main cities but especially in Dublin and the big hotels will easily be able to cope with this increase. It would appear from the outside that the Irish Hotels Federation didn’t do enough to protect the smaller businesses within the sector.

The unfortunate casualty from this rate increase, besides the non-city centre accommodation providers is the restaurant industry.  We all know how difficult it is for businesses in that sector to keep going, even in the good times.

There has been some casualties from the increase in the VAT rate to 13.5% but for once I think the government had no real option on this one but to increase the rate. The lower rate did its job at the time but it was never going to be a long term policy.  Interestingly print newspaper will retain the 9% rate and the electronically supplied news media will also be able to avail of the rate, which before the budget was at 23%.

On VRT there will be a 1% surcharge on all diesel cars bought after 1 January 2019. There will also be an extension VRT relief available on hybrids and plug in electrical hybrids for an additional year up to the end of 2019.