Irish government called to cut VAT
Wednesday December 2, 2009
Ireland urgently needs to cut its VAT rate in order to increase competitiveness with its neighbours, it has been suggested.
The Irish Independent pointed out that the difference between the UK’s current VAT rate of 15 per cent and Ireland’s 21.5 per cent rate has been a key factor in scores of shoppers crossing the border to Northern Ireland to obtain goods at a cheaper rate.
In order to raise revenue, compete with neighbouring markets and stimulate economic recovery, the Irish government needs to seriously reconsider its VAT rate, the publication stressed.
An editorial in the paper explained: "There is one area in which [the finance minister] could help the economy and quite likely raise revenue – by means of a tax cut, not an increase."
Retail Ireland recently reported that the migration of consumers to Northern Ireland for shopping trips resulted in the loss of around 1,700 jobs in November at an average of one job loss for every 150 cross-border shopping excursions.