Irish consumers will be facing higher prices for fuel and in hospitality tomorrow as the VAT and excise duties are set to be hiked at midnight.

The reduced VAT rate of 9% that has been in place since November 2020 will be returning to 13.5% while excise duties for petrol and diesel are increasing by €0.07 and €0.05 per litre respectively.

This will result in an additional cost of €3.85 to fill an average car with petrol and €2.75 more for cars running on diesel.

Restaurant and pub chiefs have blasted the incoming VAT hike as the "nail in the coffin" for many small businesses.

Read more: Cheapest Dublin petrol and diesel prices right now with fuel costs to rise from midnight

Chief Executive of the Restaurants Association of Ireland Adrian Cummins said: “The increase is wrong at a time when the country needs to reduce inflation, a VAT increase only adds to inflation.

"Government need to restore the 9% VAT for Food related Hospitality businesses in Budget 2024 and we will me making the case for this when we meet with the Minister for Finance next week. The increase the vat rate is the final nail in the coffin for many small cafes, restaurants and food led pubs.”

The extension of the reduced rate is estimated to have cost the Exchequer €300m in tax revenue foregone.

Do you think the Government should be increasing excise duties for fuel and the VAT rate for hospitality and tourism? Should they have extended the lower VAT rate of 9% and held off on increasing fuel duties? Let us know your thoughts in the comments below.