Government urged to extend Vat reduction until end of May
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The Government has been urged to keep Vat reductions in place for at least another three months.
The standard Vat rate was reduced from 23% to 21% — mainly to help Covid-hit retailers —
in last July’s stimulus plan. The reduction period is due to expire at the end of this month.
Finance Minister Paschal Donohoe told the Oireachtas budgetary oversight committee, this week, that it is the Government’s intention to return the Vat rate to its original level at the end of the planned period.
Sinn Féin’s finance spokesperson Pearse Doherty said the reduction should remain until the end of May and then be reviewed.
He said an extension would allow businesses to support their cash margins as restrictions look likely to be extended.
Meanwhile, latest figures confirming Ireland as having the second-highest mortgage interest rates in the eurozone has prompted calls for customers to switch lender.
Although marginally down in December, the weighted average interest rate on new mortgages in Ireland is 2.76% compared to a eurozone average of 1.29%. Only Greece is more expensive.
Brokers Ireland said switching could save €25,000 on a €300,000 mortgage over 30 years.
Brokers Ireland also warned that if Ulster Bank exits the Republic, it would diminish competition in the mortgage market.