The hospitality VAT rate is "absolutely certain" to rise at the end of August, Green Party leader Eamon Ryan has promised.
The reduced 9% rate for restaurants and hotels was widely expected to return to 13.5% when the Government's cost-of-living package was announced earlier in the week.
It had been cut during the pandemic to help out the sector, which was badly hit by lockdowns.
The Government had given clear indications that the 13.5% rate would return, with numerous TDs raising concerns over "price gouging" by hotels after the lockdowns ended.
But eventually Coalition leaders agreed on another extension until the end of August, with Minister for Tourism and Green Party TD Catherine Martin pushing for it to continue.
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Sources said the move was a sop to the Green Party, which in turn dropped its opposition to the extension of fuel excise duty cuts.
Yesterday, Mr Ryan insisted that the measure - which will cost the taxpayer €300m - will be the sector's last reprieve.
"One thing is absolutely certain, and you can haul me back in here if on September 1 this doesn't happen - it will be raised at the end of August" he told Newstalk Breakfast. "Haul me over the coals if that doesn't happen.
"The main time for allocation is in the Budget and in that period in October, we do need to know that we have the tax base to be able to provide for housing, social welfare, health and education and so on."
He added that "I think those sorts of measures are needed to help us do that".
Mr Ryan continued: "Economics is a very uncertain science but the argument was made that inflation is coming down at the moment. Let's just time some of these [measures] so we see it go down further, because when you put up the prices through a measure like that, it does have [an impact]."
He concluded: "I think it's about 0.2 or 0.3% of an increase in inflation it causes and the argument was made: 'Well listen, with inflation on the way down, let's keep it going down because that is actually a good economic strategy.'"
