Ireland VAT Rates: 2026 Changes

VAT Rate Changes in Ireland: State Budget 2026

The Irish Government has outlined several significant changes to VAT rates as part of Budget 2026. The key proposals include moving to 9% the following supplies:

• A reduction in VAT on the sale of new apartments from 13.5% to 9%, effective from 8 October 2025 and running to 31 December 2030.
• A reduction in VAT for food-businesses, catering and hairdressing from 13.5% to 9%, taking effect from 1 July 2026.
• An extension of the lower 9% VAT rate for utility bills (electricity and natural gas) for a further period through to 31 December 2030.

The measures are designed to ease cost pressures for households, stimulate activity in the hospitality and construction sectors, and bolster housing supply and affordability.

Businesses operating in affected sectors should prepare now for these changes. In particular, food service, catering and hairdressing businesses must plan now for systems and pricing changes in advance of 1 July 2026. The reduced rate excludes alcoholic drinks, bottled water, soft drinks and sports drinks; businesses will need to ensure correct categorisation. Also, the energy suppliers and businesses with large utility inputs should note the long-term stability of the 9 % rate through 2030, which may impact investment and pricing decisions.

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Past VAT Rate Changes in Ireland

Irish State Budget for 2025

Ireland extended again the 9% temporary reduced VAT rate on gas and electricity, now running from 1 May, 2025, to 31 October, 2025. Find . This reduced rate, initially introduced on May 1, 2022, has been extended several times, postponing the planned return to 13.5% on November 1, 2024 and May 1, 2025.

Also, from 1 January 2025, the VAT charged for the supply and installation of a heat pump was reduced from 23% to 9%.

Other temporary VAT reductions were previously introduced to help offset inflation impacts. For instance, VAT for tourism, hospitality, and hairdressing sectors returned to 13.5% in August 2023, ending the previous 9% rate.

VAT Rate Changes in Ireland: 2024 and 2023

In recent years, Ireland has made several significant VAT rate adjustments.

2024 changes:

• VAT on audiobooks and e-books has been reduced from 9% to 0%.
• A 0% VAT rate now applies to the supply and installation of solar panels on school buildings, including related equipment under the same contract.

2023 changes:

• VAT on newspapers and news periodicals, including digital versions, was reduced to 0% from 9%.
• Certain health products, including period products, defibrillators, non-oral hormone replacement therapy, and non-oral nicotine therapy, now have a 0% VAT rate.
• The VAT rate for tourism and hospitality services was set permanently at 13.5%.

These reductions aim to support various sectors and essential services across the country.‍

Have a look at our VAT rates overview for Ireland here. Also, check our VAT rates in Europe overview here.