Pearse Doherty (Donegal, Sinn Fein)
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308. To ask the Minister for Finance if the reduced rate of VAT for hospitality and tourism from 13.5% to 9 % is included in the base in the Summer Economic Statement 2021. [39504/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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Budget 2021 introduced a reduction in the rate of VAT for the hospitality and tourism sector from 13.5 per cent to 9 per cent. This measure was, initially, to provide support from November 2020 to end-2021. In recognition of the continuing challenges facing the sector as a result of the pandemic and the necessary public health restrictions, the Government announced in theEconomic Recovery Plan that the temporary VAT rate reduction will be extended to 1 September 2022.

The original costing for this scheme included in the budgetary arithmetic in October 2020 was for a total cost of €401 million, as listed in the Budget 2021 Tax Policy Changes document. The extension of the measure as announced in the Economic Recovery Planis estimated to cost an additional €350 million next year.

The full estimated cost of this measure was incorporated into the high level, 'top down' update to my Department's fiscal projections published in the Summer Economic Statement published earlier this month.

Pearse Doherty (Donegal, Sinn Fein)
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309. To ask the Minister for Finance if Covid-19 related measures as outlined in table 2 of the Summer Economic Statement 2021 are included in the base or will form part of the budgetary package for the years 2022 to 2025; and if he will make a statement on the matter. [39505/21]

Paschal Donohoe (Dublin Central, Fine Gael)
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I refer the Deputy to table 4 of the Summer Economic Statement 2021 (SES) which provides a breakdown of temporary versus permanent voted expenditure. The expenditure rule outlined in the SES – which fixes the growth rate of expenditure at trend growth until the mid-part of the decade – refers only to permanent voted expenditure.

The Covid-related measures as outlined in table 2 of the SES are temporary measures which will not be included in the base nor form part of a budgetary package.

The Budget package for 2022 is €4.7 billion. Separate to this, a total of €6.8 billion has been allocated for Covid-related expenditure. The tax measures referred to in table 2 will fall out of the tax base once they expire.

There is a minimal level of Covid-related expenditure from 2023 onwards. This relates to ‘automatic stabilisers’, and again, is not included in the budgetary packages in these years.