The Hotels Federation of Ireland is calling on the Government not to raise the VAT rate from 9% in March. It's vice president and manger of the Slieve Russel Hotel in Cavan, Tony Walker, says the outlook for the sector is becoming less certain.
Speaking to Northern Sound, he said pent up demand is unwinding, overseas markets are entering a downturn, consumer confidence is down, and energy costs are sky high. Mr Walker pointed out that hotels have seen their electricity costs jump by 10 or 12% and tourism is down from the UK - a scenario that is negatively impacting the Northern Sound region.
He added that the last thing hotels want, is to have to increase their prices from the 1st of March because the VAT rate changes. "The support we did get from Government during Covid - we really needed that support to keep businesses afloat and to keep people employed.
"We really do appreciate that, however, we do feel that a 50% increase in the VAT rate back up to 13.5% on the 1st of March next year is the wrong time. And, we are calling on the Government to reconsider that decision," Mr Walker said.