Retailers – Changes to 9% VAT Rate Budget 2019

Retailers – Changes to 9% VAT Rate Budget 2019

October 11th, 2018

Following the Budget Statement from Minister for Finance Paschal Donohue on Tuesday, retailers should familiarise themselves with the range of products, currently attracting the 9% second reduced rate that will now attract VAT @ 13.5% from January 1st, 2019.

Increase in VAT Budget 2019

In retail/wholesale, the 9% VAT covered:

  • Hot Tea and Coffee
  • Hot Sandwich – including hot/toasted bread, bagels, baguettes, paninis and wraps and also includes cold bread, baguettes, paninis and wraps that contain hot fillings.
  • Hot Fish, Chips, Burgers
  • Take Away Food (Hot)

For retailers selling food and drink in a sit-down facility, the changes are as follows


For many retailers, especially those with sales of coffee/tea and take-out hot food, they will incur very significant additional VAT liabilities. For retailers that account for their VAT on an annualised basis, this will mean that a system to monitor these extra liabilities needs to be put in place to avoid interest and penalties being incurred if the current agreed payments fall short of the actual liability.

We have asked our affiliate accountancy practice to prepare a simple “do’s and don’ts” with regard to the potential pitfalls that may occur with the amended VAT rates.

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