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<p>Latest statistics show that tourism expenditure associated with overnight trips
in Northern Ireland has increased by 9 per cent over the last 12 months.</p><p> </p><p>
</p><p> </p><p>The Treasury has previously considered the impact of a VAT cut for
the UK tourism sector on growth and jobs. The conclusion the Government reached is
that a VAT cut would not produce sufficient economic growth to outweigh the revenue
shortfall. A VAT cut for this sector would therefore need to be funded either by additional
borrowing or by raising other taxes, both of which are likely to have a negative effect
on the economy. The Government therefore have no plans to introduce a VAT cut for
this sector.</p><p> </p><p> </p><p> </p><p>Under EU law it is not possible to introduce
a specific VAT rate for Northern Ireland that differs from that applied in the rest
of the UK.</p><p> </p>
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