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BUDGET 2023: We did not price-gouge say hotels

October 3rd, 2022 12:30 PM

By Kieran O'Mahony

(Photo: Shuttertsock)

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WEST Cork hotels have slammed the government’s decision to increase the hospitality Vat rate from 9% to 13.5% next March, and said they are taking the flack for ‘price gouging’ carried out by some Dublin hotels.

They are calling for the decision to be reversed because, they say, it comes at a time when rising energy costs are making it increasingly difficult to operate and maintain margins.

The measure means Ireland’s tourism Vat rate will be the second highest in the EU zone, after Denmark.

Michael O’Neill Jr of Fernhill House in Clonakilty said it’s an absolute disaster for hotels in West Cork and it’s like ‘blow after blow’ for the sector.

‘I wasn’t expecting a miracle, but this is certainly bad news – a disaster – for hotels like ourselves in West Cork, who employ so many people directly and indirectly. It’s going to make things very tight and it’s very disheartening.

‘We weren’t price-gouging down here, unlike some hotels in Dublin and now we’re getting mixed messaging that the government may look at reviewing the rate again in January.’

Michael said that they will ‘have to roll up their sleeves’ and do their bit, but it will be tough going.

Neil Grant of the Celtic Ross Hotel in Rosscarbery said the hospitality sector needs certainty on Vat and described the energy supports announced this week as a ‘token gesture’. ‘They don’t go far enough,’ he said.

‘It’s only addressing one small aspect of doing business and if they put in a sweep of supports that would be something. I’m angry, too, that politicians don’t understand that Dublin doesn’t reflect the rest of the country, and thousands of jobs in West Cork need this 9% rate,’ he said.

‘The government doesn’t understand how hospitality and tourism works.’

Annette O’Donovan of the Westlodge Hotel in Bantry said that coupled with rising energy costs, it’s going to be impossible for some businesses to survive a hike in Vat and she called on Minister Donohoe to reverse the decision as a matter of urgency.

‘Minister Donohoe referred to price gouging that went on within the tourism sector – this was not the case in West Cork,’ said Annette.

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