Hotels Welcome Extension of 9% Tourism VAT Rate and Energy Supports

Tuesday, 21^st February 2023: Hoteliers have welcomed the Government’s decision to extend the 9% tourism VAT rate and to reform the energy support scheme for businesses. Denyse Campbell, President of the Irish Hotels Federation (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.

“Today’s 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.”

Ms Campbell noted that most European countries apply a reduced rate VAT rate to tourism accommodation: “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. The current VAT rate is in line with our European neighbours, in particular those countries where tourism plays a key role in their economy.”

Ms Campbell also welcomed changes to the TBESS energy support scheme designed to provide greater assistance to businesses experiencing exceptional increases in energy costs.