Reduced Vat rate for hospitality sector would 'benefit higher-income households more'

During the pandemic, the Vat rate was reduced from 13.5% to 9% to help support the industry hit hard by the crisis. It was brought back to 13.5% last month. File picture

Reducing the hospitality Vat rate would “benefit higher-income households more” and would not “automatically translate into reduced prices for lower-income households”, a new report has claimed.

The paper from the Oireachtas Independent Parliamentary Budget Office (PBO) analysed the rationale for a reduced Vat rate for the hospitality and tourism industries ahead of Tuesday's budget.