Reduced VAT rate will support Mayo businesses and protect jobs

THE permanent reduction of the VAT rate from 13.5% to 9% for qualifying food, catering and hairdressing services will help protect jobs, support local employers and give businesses across Mayo greater certainty, says Minister of State Alan Dillon.

The reduced rate, which comes into effect from tomorrow (July 1), will apply to cafés, restaurants, pubs serving food, takeaways, caterers and hairdressers.

Said Minister Dillon: “I know how important small businesses are to every town and village in this county. From cafés in Castlebar, restaurants in Westport, pubs serving food in Ballina, and family-run businesses in Claremorris, Swinford, Ballinrobe, Belmullet, Charlestown and right across Mayo, these businesses are at the heart of local life.

“They employ local people, support local suppliers, bring footfall into our towns and villages, and play a vital role in our tourism and hospitality economy.”

Minister Dillon said the measure is about jobs, certainty and keeping main streets alive.

“Running a business is not easy. Costs have risen across the board - food, energy, wages, insurance and rent. Many businesses are working harder than ever, but margins are tighter.

“A business can be busy and still be under serious financial pressure. That is the reality I hear from small business owners across Mayo.

“This permanent 9% VAT rate gives businesses breathing space, helps protect jobs and gives employers certainty to plan ahead.”

There are around 20,000 restaurants, pubs and hotels across the country. In 2025, there were 186,000 people employed in accommodation and food services, with 75% of businesses employing fewer than 10 staff.

Minister Dillon added: “These are not faceless businesses. They are local employers, often family-run, who open the doors early, pay wages, train young people and serve their communities.

“Jobs in hospitality, food services and hairdressing are vital for Mayo. They are often a young person’s first job, a parent’s flexible job, or a full-time worker’s livelihood.

“A business that closes employs nobody. That is why this measure matters.”

He continued: “This change will be felt on the ground by cafés, restaurants, pubs serving food, takeaways, hairdressers and local service providers who have worked hard through challenging times.

“The permanent 9% VAT rate is about protecting jobs, supporting local businesses and keeping Mayo’s towns and villages strong.”