The tourism industry is being crippled by hefty costs and high taxes, it was claimed today.
The Irish Hotels Federation urged the Government to urgently overhaul the local authority rates system and rein in its tax charges to create a fairer business environment.
John Power, chief executive of the federation, said Ireland's VAT regime was inhibiting the industry's potential to grow.
"The 13.5 per cent VAT rate applied to accommodation and meals is a blockage to competitiveness and growth in its own right," he said.
"However, coupled with the fact that the Irish tax system prohibits the refunding of VAT on corporate hotel and restaurant expenditure, this regime puts the Irish tourism sector at a distinct disadvantage to other competing destinations."
The 400 delegates at the second day of the IHF 67th Annual Conference in Cork called on the Government to reduce VAT on hotel accommodation from the current rate of 13.5 per cent to 10 per cent. The IHF said the future of Irish tourism depended upon its ability to control the cost base to ensure value for visitors.
The industry claimed local authority rates were rising at an average of 6 per cent a year and placing an unfair burden on the commercial sector.
Mr Richard Bourke, IHF president, said the Government should move to a more equitable system of calculating charges based on the profitability of a business rather than the size of its property.
The president claimed a recent increase of 8 per cent in rates by Galway County Council was three times the current rate of inflation - and came on top of a 33 per cent increase in charges in the area over the past three years.
Hotel owners also raised concerns about a proposed 9 per cent increase to the national minimum wage bringing it to €7.65 per hour.
Mr Bourke said the Employment Department should reject the Labour Court's recommendation as it would make the country an uncompetitive tourism destination.
The hoteliers, which employ around 60,000 people, said labour costs were the biggest overhead.
New
figures from the Central Statistics Office showed overseas visitor numbers were up 5 per cent with around 1,428,000 trips taken to Ireland during the last three-months of 2004.
PA