Jimmy Deenihan
Ceist:45 Mr. Deenihan asked the Minister for Finance if he will postpone VAT increases on hotel accommodation and other tourism related products outlined in the budget until January 1994.
Written Answers. - VAT Increase on Tourism Related. Products.
The increase in VAT on hotel accommodation and other tourism related products which I announced in the budget occurred in the context of a considerable simplification and consolidation of the entire VAT rating structure. This involved, inter alia, the abolition of the 10 per cent rate and the moving of most of the goods and services, formerly at that rate, to the single reduced rate of 12.5 per cent.
I do not propose to defer the change until January 1994. I am aware that in some cases hoteliers and other operators would have entered into contracts at fixed rates for the 1993 season before the budget change was announced. Accordingly, in order to minimise any disruption to trading interests, the Financial Resolutions passed by the House on budget night provide that the former 10 per cent will continue to apply to such contracts.