Michael McGrath (Cork South Central, Fianna Fail)
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71. To ask the Minister for Finance the cost that would be incurred in 2014 if the current reduced 9% rate of VAT was to continue for an additional year; and if he will make a statement on the matter. [39936/13]

Michael McGrath (Cork South Central, Fianna Fail)
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72. To ask the Minister for Finance the approximate revenue foregone as a result of the 9% VAT rate in each year since its inception in 2011; and if he will make a statement on the matter. [39957/13]

Michael Noonan (Limerick City, Fine Gael)
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I propose to take Questions Nos. 71 and 72 together.

The 9% reduced VAT rate for tourism related services was introduced in July 2011 as part of the Government Jobs Initiative. The measure was designed to boost tourism and create additional jobs in that sector. The measure was estimated to cost €120 million in 2011, €350 million in 2012, €350 million in 2013, and €60 million in 2014. As the rate was introduced for a defined period, failure to revert the 9% rate to 13.5% would give rise to an annual Budget shortfall of €350m in a full year.