Ireland raises VAT 2% to 23% from 1 January 2012
Ireland is to increase its standard VAT rate from 21% to 23% from January 2012. The rise was announced in this week’s budget.
This increase is an acceleration of plans to raise the VAT rate to 23% by 2014. This original plan was announced in 2010 to assure financial backers of Irelands intent to restore balance to its fiscal position. The target is to reduce the GDP deficit from over to 10% to below 3% by 2015.
The increase was originally leaked via the German Parliament last month. The Irish draft budget was circulated to all other 26-member states of the European Union as part of the Irish bail out conditions with the European Union, International Monetary Fund and European Central Bank.