Referring to the 9pc rate as a “preferential” rate or a VAT “subsidy”, as some commentators do, is an inaccurate analysis. Often this is followed by a spurious reference to the “cost” of the measure whereas in fact the tourism VAT rate has been massively beneficial to the Exchequer. According to the Revenue’s own figures, in the first full year of the 9pc VAT rate (2012) income to the Exchequer was 630m; in 2018 the income is anticipated to be 1.04bn as a result of the increased activity in the sector.
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