The ‘something for everyone’ Budget giveaway didn’t extend to one of Galway’s biggest industries and employers as tourism chiefs counted the cost of its continuing higher VAT rate – and warned of a “deepening crisis” in the sector.

It was perhaps the biggest disappointment in a pre-election package that attempted to spread the good news across all sectors, with the middle classes particularly targetted ahead ot the country heading to the polls.

Hoteliers and vintners had been calling for a return of the special 9% tourism-related VAT since it was increased last September, warning of mass closures in an industry that’s worth over €300 million annually to the county alone – not including the tourism hot-spot of Galway city.

However, in Budget 2025 announced by Minister for Finance Jack Chambers this week, the 13.5% rate was maintained.

The Irish Hotels Federation expressed “deep disappointment” at what it called a “short-sighted” move by Government.

IHF President, Michael Magner, said the measures for the industry which were announced – including €226 million for the tourism sector and a new energy subsidy scheme for businesses – would “do nothing to address the enormous challenges confronting our sector”.

On a more positive front, Galway West TD and Government Chief Whip, Minister Hildegarde Naughton (FG), described Budget 2025 as a ‘cost-of-living budget’, and pointed to measures such as two electricity bill credits totalling €250, double payments for social welfare recipients in autumn, and a double child benefit payment later this year as attempts to ease the burden on hard-pressed individuals.

Caption: Ministers Jack Chambers and Paschal Donohoe with this week’s Budget 2025.

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