Michael McGrath (Cork South Central, Fianna Fail)
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The Deputy should note at the outset that for VAT purposes hairdressers are considered a separate sector from hospitality. However similarly to hospitality under Annex III of the VAT directive a reduced VAT rate can be applied to this sector.

Consequently when the decision was made to apply the 9% rate to the tourism and hospitality sectors because of how they were impacted by the public health restrictions put in place throughout the pandemic, it was thought appropriate to also apply it to the hairdressing sector as they were similarly impacted. It was made clear however at the time that the 9% rate was applied, that it was only a temporary measure. As a result, when the temporary 9% VAT rate was restored to 13.5% for tourism and hospitality it was considered necessary to also restore it for hairdressing.