Taoiseach Bertie Ahern has said that the Government will try to deal with the issue of VAT refunds for people staying in Ireland for business conferences in the context of the next budget. Colm Keena reports.

However, Mr Ahern said while the Government was conscious of the importance of the issue, it was not a simple matter.

"If an acceptable solution can be found, we will try to find it in the context of the next budget," he told the Irish Hotels Federation conference in Dublin.

Mr Ahern said there was a number of niche tourism markets that could be exploited more effectively, including business tourism and conference-based business.

"The global conference market is estimated to be worth up to €40 billion per annum and we need to take a greater slice of that market."

He said a national conference centre was an essential part of the infrastructure of any capital city.

"The process in relation to the provision of this facility is now well advanced and I look forward to current negotiations being concluded successfully so that the centre will be up and running as soon as possible."

The president of the federation, Richard Bourke, in a statement to the media, said the current prohibition on VAT refunds for conference accommodation costs was "a serious deterrent to business tourism".

He said Ireland's competitiveness in the business tourism sector was "seriously undermined" by the inability of VAT-registered businesses to claim refunds on accommodation expenses incurred on "legitimate business activities such as conferences, incentives and major corporate meetings".

He said firm contracts for the building of a national conference centre should be entered into early this year.