Irish tax hike could help N. Ireland

DUBLIN, Ireland, Nov. 19 (UPI) -- Irish retailers warn that an increase in the sales tax will encourage shoppers to head to Northern Ireland for liquor, cigarettes and household goods.

The proposed 2 percent increase in the value added tax known as the VAT would raise the total to 23 percent, The Irish Independent reported. That would mean shoppers could save 3 percent by crossing the border.

The government was forced into announcing the increase sooner than it intended. The proposed budget was sent to the European Commission, a condition of the bailout Ireland is getting, which sent it to all EU member governments. In Germany, the Irish budget was given to the lower house of the Bundestag, and it quickly became public.

Frank Gleeson, chairman of Retail Ireland, said the VAT hike would lead to lost jobs while the country is struggling to recover from the financial crash.

"The run-up to the busy Christmas trading period is the worst possible time of year to make these announcements," he said.