Food businesses welcome 'long-fought' Vat reduction while wet pubs say Budget 2026 'failed to deliver' 

Restaurants Association of Ireland said reduction will play a 'vital role' in safeguarding jobs, while vintners say they have been 'ignored' by the Government

The Vat reduction followed a long campaign by hospitality businesses and lobby groups who have argued that a rate decrease was essential to help a struggling sector operating on razor-thin margins. PIC: NO FEE, MAXWELLS

The Restaurants Association of Ireland has welcomed what it has called a "long-fought victory" for the industry following the Government's decision to reinstate a lower rate of Vat for the sector. 

Finance minister Paschal Donohoe announced that the Vat rate for food and catering businesses would be reduced from July 1, 2026 to 9% from 13.5% as part of this year's budget. Mr Donohoe said that this measure will cost €232m in 2026 and €681m in a full year.