TAXATION:CONSUMERS WILL face higher taxes on spending over the next four years, with the top VAT rate set to reach 23 per cent by 2014.
The standard rate of VAT, which is charged on most goods and services in Ireland, will rise by 1 per cent to 22 per cent in 2013, and to 23 per cent in 2014.
In January of this year, the 0.5 point increase in VAT imposed in 2008 was reversed, and the standard rate restored to 21 per cent, in an attempt to stem cross-Border shopping.
In January 2011, the UK will increase its rate from 17.5 per cent to 20 per cent.
The Government said the reduced rate of 13.5 per cent would be left unchanged as any increase in this rate could harm employment. Other ways of rebalancing the VAT system will be looked at. It is estimated that the proposed rate measures will yield €620 million in a full year.
A number of changes will also be made to excises duties and licences in 2011, yielding an estimated €110 million.