Belfast Telegraph

Northern Ireland hoteliers urge cut in VAT to stop £128m loss

By Lesley Houston

Northern Ireland's hoteliers have called for a cut in VAT to 5% to avoid the loss of £128m in tourism revenue over the next six years.

The call was made during a meeting of the Northern Ireland Hotels Federation, which gathered hotel bosses to discuss a new policy document called Tourism 2020: Investing in our Future.

The paper has called for a medium-term strategy for the whole tourism sector, the VAT reduction, a study on the long-term future of tourism, more world class events and cohesive marketing and a delivery agency for tourism and hospitality

The Tourism 2020 report reveals that the hospitality and tourism industry directly employs around 60,000 people in Northern Ireland and contributes £860m to the economy annually. However, VAT in the Republic of Ireland is 9%, some 11% lower than the 20% rate in Northern Ireland.

NIHF president Mandy Patrick said growing Northern Ireland's tourism sector was vital, especially in light of recent heavy investment in the industry by the private sector.

"In order to do so the business climate has to be more favourable and one of our key asks is a reduction in VAT to 5%," she said.

"Our study shows that not reducing VAT could cost the Northern Ire;amd economy £128m in lost economic potential in the next six years.

"Businesses in border locations are faced with a real challenge.

"A reduction of the VAT rate from 20% to 5% would be the game changer for the tourism industry in Northern Ireland and the rest of the UK."

In a keynote address, Foyle MP Mark Durkan agreed the issue of VAT must be addressed.

"Most EU states have targeted VAT concessions at tourism and hospitality trades and clearly recognise the economic benefits," he said.

Belfast Telegraph