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Retain 9% VAT Rate & Reduced Employers PRSI

The Irish Hotels Federation (IHF) is campaigning for the 9% VAT rate and PRSI initiatives introduced in 2011 to help the hospitality sector be retained in the coming budget and beyond.

The combined effects have been to lower prices, increase economic output and increase employment and these benefits are at risk if the initiatives are not continued into 2014.

The lower tax rate brings Irish hospitality closer in-line to key competitor countries including France and Germany (both 7%) and the major tourism destinations of Portugal (6%), Greece (6.5%) and Spain (10%).

One of the key benefits of the lower rates was to enable our industry to pass the savings to guests and travel trade partners. This change was strongly reflected in the 2013 Fáilte Ireland annual Visitor Attitudes Survey which reports perceived value for money by overseas visitors at levels last seen 10 years ago.

Improved competitiveness and better value for money has worked. International visitor numbers have grown by 4.6% more since 2011, despite the continued challenges in our source markets.

Since their introduction hospitality businesses have increased direct employment by 13.3% with 129,600 people working in the industry. IBEC has calculated the multiplier effect of these jobs on the overall economy is an extra 35,000 jobs.

I urge everyone to support the IHF and petition for the retention of the lower VAT and PRSI rates to help the Irish tourism industry as we continue our recovery.

Read the IHF Briefing Paper for Ministers, TDs and Senators.

Keep the lower VAT & PRSI rates to sustain the recovery of the Irish hospitality industry