Republic of Ireland finance minister Michael Noonan has confirmed the controversial €3 air travel tax will be abolished.
Noonan said VAT on restaurants, hotels, cinemas, theatres, sports fixtures and other attractions would also be cut from 13.5 per cent to nine per cent as the nation sought to boost tourism receipts.
Ireland is presently undergoing a period of austerity having been forced to seek an emergency bailout from the European Union in order to meet debt obligations.
Short-term visa requirements will be also relaxed for holidaymakers from 14 countries worldwide in an attempt to encourage more visitors.
The removal of the air travel tax is, however, dependant on airlines, which will be required to open new routes and boost passenger numbers.
The tax will remain on the statue books and will be reinstated if this does not happen.
Ryanair – the largest national airline – welcomed the move.
Spokesman Stephen McNamara said: “We are working with minister Varadkar and the dept of transport to see if a competitive cost package can be finalised at the Irish airports to win rapid traffic and jobs growth for Ireland, so today’s decision to scrap the tourist tax is a welcome move by the new government towards change and reform of Irish tourism.
“Hopefully the DAA cost obstacles can also be removed to enable Ryanair to deliver rapid tourism and jobs growth in response to today’s welcome announcement.”