Sandra McLellan (Cork East, Sinn Fein) | Oireachtas source

There is major concern in the tourism and hospitality sector at the prospect of VAT rates being increased from the current 9% to 13.5%, a substantial increase. I have been lobbied, as has the Minister of State, by the tourism and hospitality sectors in this regard. They make a good case.

It is the view of Retail Excellence Ireland that far from raising revenue, reversion to the higher rate of tax will cost the Exchequer some €173 million and perhaps as much as 13,500 jobs. Has the Minister of State, Deputy Ring, met many of the tourism and hospitality bodies and can he outline the nature of these discussions? I am glad he stated that he has met the Minister and outlined the case to him because Deputy Ring was keen earlier on in government to emphasise the importance of the reduction to the 9% rate.

According to a recent report, the change in VAT has cost the State €88 million in net VAT receipts. However, according to the Department of Finance assessment of the success of the intervention, the employment gain equates to €261 million in increased Exchequer employment taxation receipts and social welfare savings.

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