VAT rate of 9% for hairdressers extended until September 2022

The Irish Government has published its Economic Recovery Plan, which sets out how it intends to support the full resumption of economic activity and get people back to work as the country emerges from the Covid-19 lockdown.

Among the supports included in the plan is the extension of the 9% VAT rate for hairdressing services until September 2022.

The Hair and Beauty Industry Confederation (Habic) has welcomed this move and said that it will continue to lobby for this rate to include beauty services.

The Employment Wage Subsidy Scheme (EWSS) is to be extended until the end of the year, and businesses may apply for enhanced reopening payments. The Covid-19 Restrictions Support Scheme (CRSS) is to be extended beyond 30 June until the end of the year. 

A new Business Resumption Scheme (BRSS) will be introduced in September. This is designed for ‘vulnerable but viable’ businesses, particularly in sectors that were significantly impacted throughout the pandemic, even during periods when restrictions were eased.

Businesses whose turnover is reduced by 75% between 1 September 2020 and 31 August 2021, compared with 2019 will be eligible. The scheme will not be restricted by location, rate paying or physical premises. The BRSS will be administered by Revenue and will operate in a similar way to CRSS.

Meanwhile, the commercial rates waiver will be extended until the end of September in its current form.