A West Clare hotelier is warning that jobs will be on the line in the hospitality sector if the lower VAT rate isn’t retained.
It comes amid mounting concerns over a reduction in the number of people visiting here next year.
Despite an uplift in tourism following the pandemic, overall hotel room occupancy rates are still significantly down this year, compared to 2019.
Figures from the Irish Hotels Federation show that for the first ten months of the year, average room occupancy levels were at 71% nationally and 73% for the Mid West, down from 80% three years ago.
This has led to calls from the IHF and the Irish Tourism Industry Confederation, among groups, for the increase in the VAT rate for the sector to be delayed.
The lower 9% rate was introduced in 2020 to help support the tourism and hospitality industries during the Covid-19 pandemic, but following on from Budget 2023, it’s due to go back up to 13-and-a-half per cent at the end of February.
Former Chair of the Shannon branch of the IHF, Dermot Kelly says businesses will be forced to pass on some of the burden of the increased VAT rate to customers.
It comes amid mounting concern over the year ahead.
60 per cent of hoteliers across the country have reported reduced bookings from the UK, 47 per cent said they had less bookings from Northern Ireland, while 38% report reduced bookings from the rest of Europe.
A West Clare hotelier says its becoming very hard to hold prices, which he fears could have a long-term impact on international tourist confidence.
Owner of the Armada Hotel in Spanish Point, John Burke says businesses are making cuts wherever possible, but he’s warning jobs will be on the line, if further supports aren’t provided.
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