Hoteliers want VAT drop to last for five years

Bernadette Randles:
It is an important measure that will stimulate demand and aid recovery

HOTELS and guesthouses in Kerry have welcomed the measures and supports announced in Budget 2021 by Ministers Paschal Donohoe and Michael McGrath.

Irish Hotels’ Federation Kerry branch chair, Bernadette Randles, welcomed the extension of employment supports to the end of 2021 and the rates waiver scheme along with the reduction in the tourism VAT rate, which she said would help aid the recovery of the industry.

“The extension of employment supports until the end of December 2021 is very welcome. We also welcome the reduction in the tourism VAT to nine per cent, which is the right tourism VAT rate,” she said.

“It is an important measure that will stimulate demand and aid the recovery of the tourism and hospitality industry. After the last recession, tourism created 90,000 new jobs and there is no doubt that the nine per cent VAT rate contributed significantly to this increased employment,” Ms Randles said.

“Pre-Covid, our industry supported almost 270,000 livelihoods, including 15,700 jobs, and generated €592 million in revenues here in Kerry. This accounts for one in 10 jobs across the country, 70 per cent of which were outside of Dublin. Reducing the tourism VAT will help sustain jobs and communities across Ireland,’ she added.

The Killarney hotelier said as well as providing a stimulus in the Irish economy, the reduction will improve Ireland’s competitiveness as an international tourism destination but, she insisted, it should be a permanent measure, at a minimum of five years.

“Contracts with tour operators for example, which can account for over 30 per cent of many hotels’ business, are agreed two years in advance. Before today, VAT on Irish hotels was the second highest in Europe and higher than 30 European countries,” Ms Randles stated.

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