Despite a temporary extension of the 9 per cent VAT rate, it reverts to 13.5 per cent from 1 September, 2023
The VAT rate on hairdressing services is returning to 13.5 per cent from September 1, 2023. The IHF, which successfully lobbied the government to extend the 9 per cent VAT rate until this date earlier in the year, plans to meet with the minister for finance, Michael McGrath, ahead of the upcoming budget on 10 October, to discuss its reversal.
The IHF is advising salons to implement changes, including contacting software providers for instructions on changing the VAT charged to hairdressing services if needed. The IHF also reminded hair salons to review and/or implement a new price list to factor in the VAT increase, if they haven’t already.
Taking client relationships into account, the IHF suggested salons communicate the reasons for the price increases to customers via social media, email and in-salon notices.
The IHF has also shared a sample notice to help salon owners: “Starting from September 1st, there will be a change in the VAT for hairdressing services, resulting in a 4.5 per cent increase in the price of our hair services in the salon. While we understand that a lot of our clients are already under increased pressure with the cost of living, this increase, along with many others this year, is outside of our control and an increase that we as a small business cannot absorb. We thank you in advance for your understanding.”
Click here for more information about VAT changes
