Timmy Dooley (Clare, Fianna Fail)
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Question 62: To ask the Minister for Finance if he has consulted with the hospitality sector on their concerns regarding VAT increases on alcohol and the impact that any such increases would have on the viability of the sector and the consequent impact on employment levels. [36536/11]

Michael Noonan (Limerick City, Fine Gael)
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I and my officials have met with interest groups across the board in relation to the forthcoming Budget. I have since announced that I will be proposing an increase in the standard rate of VAT of 2 percentage points from 21% to 23%. This change is being introduced as part of a general package of revenue-raising measures to contribute to Exchequer funding and is in line with commitments made in the programme for Government and in the EU/IMF Programme.

As regards the hospitality sector, the proposed VAT increase will have no impact on tourism related services, which were the subject of a generous reduction in VAT to 9% earlier this year. While the VAT on all standard rated goods and services, including alcohol, is due to increase, restaurant services and hotel and holiday accommodation will continue to apply at the 9% rate.