HOTELIERS CONDEMN SHAMBOLIC APPROACH TO LOCAL AUTHORITY RATES SETTLEMENTS

Transparent Policy for Distressed Businesses Urgently Required, says Irish Hotels Federation

3rd December 2010

The Irish Hotels Federation (IHF) today condemned as shambolic the approach taken by local authorities in dealing with businesses facing difficulties meeting their 2010 rates bills. Paul Gallagher, President of the IHF states, “Hotels and guesthouses in particular are at the mercy of county and city council managers whose approach to assisting distressed businesses can at best be described as high-handed and removed from the economic realities on the ground. We’re calling for a workable system to be put in place for arranging settlements based on agreed policies that work for hotels and guesthouses in difficulty.”

“To date, a small number of local authorities in the south west have adopted a realistic approach by providing rates discounts to business in severe difficulty. However, the overwhelming majority of county and city councils have refused to engage with our members on the issue. In the interests of fairness, we need to agree a scheme across all local authorities that allows for a more pragmatic approach to providing discounts to businesses in difficulty.”

“The Government’s intention to speed up the rates revaluation recognises the inherent inequities in the rates system,” states Mr Gallagher. “In the meantime businesses are being hung out to dry with local County and City Managers who continue to bury their heads in the sand on the issue. We’ve had an astonishing lack of engagement from city and county councils so we’re calling for local council managers to now work in partnership with us to put in place structures for dealing with this issue in a pragmatic manner.”

Since the introduction of the Valuation Act 2001, only three of the 88 rating authorities have carried out the revision process.  The revisions which have been completed have resulted in the local authority rates liability of hotels being reduced by on average more than 30 per cent. Based on this experience it is reasonable to suggest that if the revisions were completed in the remainder of the country similar results would be achieved.

“Hotels and guesthouses continue to subsidise other commercial rate payers through excessive and disproportionate levies and this can no longer continue. We’ve reached a critical tipping point and believe it’s in everyone’s interest to agree a sensible arrangement that safeguards the local economy and future revenue streams of local authorities. County and City Managers must now step up to the mark and support local businesses, particularly hotels and guesthouses which employ over 56,000 people in every town and village across the country.”

The IHF states that hotels make a disproportionate contribution to local authority funding with many hoteliers being levied exorbitant rates of up to €2,500 – €3,000 per bedroom every year. The country’s 900 hotels, encompassing 60,000 bedrooms, pay approximately €90 million a year to local authorities in rates, equating to an average of €1,500 per bedroom regardless of recent trading circumstances.

ENDS

FOR INFORMATION:

Eoin Quinn                        Tel: 01 6760168

Weber Shandwick             Mob: 087 233 2191