The Irish Hotels Federation (IHF) and the Restaurants Association of Ireland (RAI) have welcomed the extension of the 9% VAT rate for the tourism sector.
IHF Statement
The IHF stated that hoteliers have welcomed the government’s decision to extend the 9% tourism VAT rate and reform the energy support scheme for businesses.
Denyse Campbell, president of the IHF, said that the measures announced now give tourism businesses greater certainty, as they grapple with the impact of the cost-of-living crisis on Irish consumers and key overseas markets.
Campbell said, “Today’s [Tuesday 21 February] announcement is a clear recognition by the government of the challenges facing tourism and hospitality – Ireland’s largest indigenous employer, which currently supports over 250,000 livelihoods. It will go a long way in helping to sustain the recovery of our industry at a time when businesses and consumers are facing significant economic and financial headwinds.
“A vibrant tourism industry is one of the most effective ways to spread employment opportunities and prosperity throughout the entire country. That is why the decision to extend the 9% VAT rate is so critical for communities and regions that rely on tourism as a major employer and driver of economic activity.”
Campbell noted that most European countries apply a reduced rate VAT rate to tourism accommodation, saying, “When you look at the tourism VAT rates among our key European competitors, it is clear that the 9% rate is the right rate for Ireland. At 9%, Ireland is in line with our European neighbours, in particular those countries where tourism plays a key role in their economy.”
Campbell also welcomed changes to the Temporary Business Energy Support Scheme (TBESS), designed to provide greater assistance to businesses experiencing exceptional increases in energy costs.
RAI Statement
The RAI stated that it welcomes the decision to extend the reduced 9% VAT rate for hospitality for the next six months, as well as the extension and alterations made to the TBESS.
Adrian Cummins, CEO of the RAI, said, “These outcomes will provide the necessary support to the restaurant and hospitality sector, as they continue to recover from the Covid-19 crisis, as well as battling high rates of inflation plus increasing pressures on their margins.
“The Restaurants Association of Ireland advocates that the government will continue to invest in the hospitality sector, so it mitigates against a cliff edge for the hospitality sector in September of this year.”
Read More: IHF Reacts To Figures Showing Drop In Tourism From Key Markets
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