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VAT increase in hospitality sector going to hit Donegal

Tourism sector critical for Donegal but Government over focus on east coast tourism boom while the western seaboard tourism struggles.

Deputy Pat the Cope Gallagher Leas Cheann Comhairle has stated the Government has made a serious error by increasing the VAT rate on Tourism and Hospitality sector, the increase in the VAT rate will have serious consequences for the hotel, restaurant and hospitality sector right throughout Donegal. The VAT hike is especially difficult to understand in the context of the ever increasing threats of Brexit and an ever competitive tourism market.

Tourism is one of the sectors showing real and tangible growth in rural areas over the past 5 to 6 years, and the growth in visitors has been impressive but it is insignificant in the terms of the tourism numbers which our cities and east coast experience each year. It is in that context that this VAT hike will hit Donegal the hardest stated Pat the Cope.

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Pat the Cope added it is another example of how this Government fails to rural proof their policies; they fail to understand the impact decisions such as this one will have in areas such as the Northwest of Ireland. Even the experts in tourism are predicting that tourism is facing into an uncertain time with many outside threats to the sector, and when one considers the sheer numbers employed in the sector it is complete folly to put the sector under further pressure.

With the Government failing to tackle rising insurance costs and the grossly unfair rates system which are a constant drag on tourism, today’s announcement only adds to the pressure our tourism employers are constantly under especially in rural areas such as Donegal where tourism can be very seasonal.

The tourism sector is critical for Donegal but this Government has again over focused on the East coast, and used the prosperity and growth in tourism in areas such as Dublin and the East coast to determine the VAT policy for the less well-off areas. It is due to that reason areas such as Donegal and other Western seaboard counties will continue to struggle concluded Pat the Cope.

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