Westmeath hoteliers call for retention of 9% tourism VAT rate

Hoteliers in Longford and Westmeath have this week welcomed comments from Tourism Minister Catherine Martin who said she would continue to seek a further extension of the 9% VAT rate for the tourism and hospitality sector in Ireland.

The 9% VAT rate on accommodation is due to expire at the end of February, and industry representatives in this region said a return to a 13.5% rate was "the last thing that should be contemplated" at the present time.

In a statement issued through the Irish Hotels Federation (IHF), hoteliers said keeping the 9% rate would "safeguard tourism livelihoods and secure the long-term, sustainable development of Irish tourism."

"The industry is at a critical juncture with consumer confidence reaching decade lows across key markets as it grapples with a cost-of-living crisis, record levels of inflation, interest rate hikes, skyrocketing business costs and a global economy that is edging towards recession," said the IHF.

It added that tourism businesses were collectively Ireland's largest indigenous employer.

"Prior to the pandemic, the tourism industry supported over 270,000 livelihoods nationally, including some 6,400 jobs throughout Longford and Westmeath, generating €87m in tourism revenues annually for the local economy," said the Federation.

"With a full recovery in tourism now likely to be delayed until 2026, an increase in the VAT rate to 13.5% is the last thing that should be contemplated given its inflationary impact and the damage it would cause to Ireland’s tourism competitiveness.

"This would result in Irish consumers and overseas visitors having to pay the third highest tourism VAT rate in all of Europe.

"Against this backdrop, hotels and guesthouses are urging the Government to retain the 9% VAT rate at its current rate," the IHF concluded.