Monday 6th March 2006

VAT RELIEF AND NATIONAL CONFERENCE CENTRE ESSENTIAL
TO GROW BUSINESS TOURISM
Tourism Chief States

The President of the Irish Hotels Federation, Richard Bourke, today stated that the current prohibition on VAT refunds for conference accommodation costs is a serious deterrent to business tourism and welcomed the statement by Mr Brian Cowan TD, the Minister for Finance, that he was not indisposed to introducing such a relief. The Minister has indicated that he wants to make sure any such relief can work, and that he will consider it for next year’s budget.

According to Mr. Bourke, Ireland’s competitiveness in the lucrative €40 billion global business tourism market is being seriously undermined by the inability to claim VAT refunds on hotel accommodation expenses incurred by VAT registered businesses on legitimate business activities as conferences, incentives and major corporate meetings. Ireland currently has an estimated 1% of the business tourism market, but the Federation believes it has the potential to capture a greater share of the market given the right competitive taxation environment.

Speaking at the Federation’s 68th Annual Conference, Mr. Bourke said, “Ireland remains the only country in Europe with a VAT rate, on hotel accommodation, in excess of 10% where VAT is not refundable on such business tourism related expenses. Ireland is trying to compete against other European countries, including Britain and Northern Ireland, who have all recognised the need to have a refund regime available to business tourism. Reform of this tax anomaly would at least level the playing pitch for Ireland in terms of competing for business tourism.”

The Federation maintains this VAT reform will assist growth in business tourism and contribute towards meeting the ambitious targets set by the Government’s Tourism Policy Review Group to increase visitors to Ireland to some 10 million people by 2010. Mr. Bourke said “The increased revenues that accrue from the positive effects following the removal of this VAT anomaly would more than compensate any loss to the exchequer.”

Mr. Bourke also reiterated the need for the setting of a definite opening date, hopefully in 2009, for the National Conference Centre and highlighted the necessity to enter into firm contracts during the early half of 2006 for its construction.  The business tourism sector including hotels, professional conference organisers, venue owners and the Dublin Convention Bureau, need to know as soon as possible the opening date for the centre. Only then can a major international promotion of the facility commence with the aim of procuring a steady flow of business for this world class venue.  

When operational, the National Conference Centre is expected to generate at least €50 million per annum for the economy. It is estimated that an additional 19 international conferences per annum could be held in Ireland resulting in 153,700 delegate days with conference attendees being one of the highest spending visitors.

“There are huge opportunities to grow the conference market here and certainly the advent of the National Conference Centre is central to putting Ireland on the map for international conferences. The long lead in time for conference bookings is an important consideration with five to seven years being the norm. Construction of the Centre therefore needs to be getting underway immediately if it expects to be in business by the stated goal of 2009. Firm bookings would need to commence by the end of 2006 and in this respect we would urge a major international marketing campaign should start in tandem with the Centre’s construction as early as possible,” said Mr. Bourke

Concluding he said, “The National Conference Centre can provide the focal point to a cohesive campaign to market Ireland as a business tourism destination. Although construction of the Centre has yet to commence, its launch can be used as part of a global marketing drive and encourage collaboration across the various industry bodies and tourism interests. The coming on stream of this world class conference centre will be a major attraction for organisers of international conferences, but a co-ordinated well funded promotion of the facility involving Fáilte Ireland, Tourism Ireland, Dublin Convention Bureau and the hotel and tourism industry needs to be designed and rolled out as soon as a definite opening date for the centre is announced.”

FOR INFORMATION:
Winifred McCourt / Niamh Boylan            Tel: 01 6760168
Weber Shandwick FCC                Mobile: 0872446004 or 086 3809191