Nine per cent VAT rate results in new jobs in Mayo

According to a report published by the Restaurants Association of Ireland, 625 new jobs in the food, tourism, and hospitality sectors have been created in Mayo since the reduced VAT rate of nine per cent was introduced in July 2011.

Speaking about the launch of the report and the success of the reduced VAT rate, Adrian Cummins, chief executive of the Restaurants Association of Ireland, said: “As this report proves, in terms of creating new jobs in the food and accommodation sector, the introduction of the new VAT rate in July 2011 has been a major driver of local employment growth. Six hundred and twenty five new direct jobs have been created in Mayo alone, with 22,300 new direct jobs created across the whole country.

“This is a very conservative estimate and does not include the number of indirect jobs created in the wider economy as a result of the multiplier effect. When the multiplier effect is included, the total number of new jobs is even more impressive, with 912 jobs created in Mayo and 32,558 jobs created nationally.” 

The report, entitled 9% VAT – Food, Tourism & Jobs – Rebuilding Ireland’s Economy, uses national employment data from the Central Statistics Office. The report examines the impact of the introduction of the new VAT rate in July 2011, when it was reduced from 13.5 per cent to 9 per cent for tourism related services and goods.

The report covers the direct and indirect number of jobs created, an estimate of social welfare savings, as well as the increase in revenue for the Exchequer (eg, PAYE, USC, and PRSI employer contribution ) at a county and national level.


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