There are “no grounds for introducing an additional tourist tax”, the Irish Hotels Federation has said in response to proposals for a Dublin bed levy.
In a statement issued to Gript today, the organisation warned that introducing further charges on visitors would make Ireland “less attractive as a destination”, citing rising costs across the hospitality sector and concerns about competitiveness.
The comments come after a proposal from a Fianna Fáil TD to introduce a new visitor accommodation levy in the capital.
Fianna Fáil TD Paul McAuliffe, who represents Dublin North West, earlier today called for legislation to allow for the introduction of a Dublin Local Authority Visitor Levy aimed at improving public spaces.
Setting out his proposal, McAuliffe said the measure could generate additional funding for local authorities.
“This morning, I am calling for legislation to allow for the introduction of a Dublin Local Authority Visitor Levy,” he said.
“If introduced, this levy would provide millions in additional funding for the budget of the city and county’s four local authorities.”
He said the levy could be used to support investment in areas frequently used by tourists and would be ring-fenced for that purpose.
“This legislation would empower local authorities to make the decision to impose a levy and it could provide for funding in areas that are frequented daily by tourists on excursions from the city centre,” he said.
“Any levy like this would have to be specifically ring-fenced for the revitalisation of the city and the amenities used by residents and visitors.”
McAuliffe also pointed to similar measures in other European cities, stating that such a levy would bring Dublin in line with its counterparts.
“This is not an aggressive form of tax, but overall, it would amount to a funding boost that would improve our capital and surroundings for visitors and residents alike.”
Responding to the proposal, the Irish Hotels Federation set out its opposition, arguing that additional taxes on tourists were not justified.
“There are no grounds for introducing an additional tourist tax on Irish consumers and overseas visitors,” the group said.
“Given the massive cost increases experienced by our industry over recent years, the last thing we should be doing is increasing taxes further making Ireland less attractive as a destination.”
It said placing additional costs on visitors would undermine efforts to promote Ireland internationally.
“Placing the burden of additional taxes on international and domestic tourists, makes no sense particularly at a time when we are trying to make Ireland stand out as an attractive destination for visitors.”
The federation also raised concerns about the impact on competitiveness and visitor spending.
“Ireland needs to remain competitive as a tourist destination,” the statement said.
“Every single additional increase in taxes increases the cost for visitors and erodes our competitiveness.”
“A bedroom tax would also mean less money for tourists to spend in downstream tourism businesses and less money when tourists go on to visit and stay in other parts of the country.”
It pointed to the existing financial contribution of the sector, particularly in Dublin.
“Dublin’s hotels make an enormous contribution to both the central exchequer and to the funding of local authority services,” it said.
“Hotels in the capital pay approximately €25 million each year in commercial rates… On top of this, many city centre hotels pay a further Business Improvement District levy of 5 per cent specifically towards improving the city for everyone who uses it.”
“This is a sector that is already paying its way, both locally and nationally.”
The group also referenced the wider tax contribution generated by tourism.
“Tourism activity generates approximately 29 cents in tax revenue for every euro spent by visitors, amounting to over €3 billion annually for the central exchequer,” it said.
“The sector is clearly contributing. Imposing additional taxes on tourists and making Ireland less attractive as a destination makes no sense.”
It warned that any reduction in visitor spending would have wider effects beyond the capital.
“Any additional cost at that entry point doesn’t just affect Dublin,” the statement said.
“Tourism businesses and communities right across the country would be negatively impacted by a drop in visitor spend.”
The federation also questioned whether new taxes were necessary to fund improvements in public spaces.
“Imposing yet more costs on tourists is not the answer to addressing the need for greater investment in maintaining and developing public spaces in our capital,” it said.
“The conversation should start with how existing taxation revenues… are being deployed, before reaching for new taxes.”