Tax on Dublin hotel guests being developed

A tax on hotel guests in Dublin is being developed by a local authority team, and could be in place by September.

Dublin’s four local authorities have backed legislation that would allow tourists to be charged an extra fee as part of their stay in the city’s hotels.

Dublin City Council, Fingal and South Dublin County councils have agreed to a working group, while Dun Laoghaire Rathdown is also expected to back the work of the group, according to the Irish Times.

Dublin City councillor Hazel Chu said the plan has cross-party support and has been “two years in the making”.

She said that tourists should “pay their little bit of share”.

The Green Party councillor said complaints about Dublin city were often about a lack of public toilets and lack of street cleaning which, she said, were usually because of a lack of funding.

Ms Chu believes the tax could raise about 12 million euro for Dublin city, but the councils have yet to confirm a figure.

“That’s 250 extra street cleaners, it’s perhaps 50 public toilets. These are all things that we need,” she told RTE’s Today With Claire Byrne.

She also said the money could be ringfenced to attract more tourists to the capital, and provide more public services, including street cleaning.

She said Dublin, and Ireland, was not attracting enough tourism.

“If you’re a tourist walking around the city right now on a great day like today, it’s glorious,” she added.

“But when you see the amount of rubbish, or you see streets not being cleaned, or you’re running from place to place and you realise there’s not a public toilet, the first thing you think is, ‘well why would I not go to any one of the 18 countries in the EU that has better facilities because they do have this tourist tax in, and actually spend my money there?’

“This is going to be quite a small amount and it’s not passed to the hoteliers.

“It’s passed to tourists who come to our country and use the networks and parks and museums and we’re asking them to pay quite a small amount.”

Micheal Lennon, director of Skylon Hotel, said that hoteliers, businesses and tourists were already spending “too much on tax”.

“I don’t think it will be in by September and there are actually no grounds for introducing additional tourist tax on both Irish consumers and on, particularly overseas visitors, that make up about 75% of our tourism,” he added.

“In terms of tourism taxes, we’re already probably one of the highest – particularly with the 50% VAT increase that we had last year, half a billion extra has gone to central government, we’re the third highest contributor to that in Europe. So we’re already spending too much in tax.

“We have to stay competitive. The VAT increase was passed on to the consumer, unfortunately. A lot of it wasn’t, particularly in the food and beverage sector. And we need to be competitive and we need to be sustainable.”

In a statement, a spokeswoman for Irish Hotels Federation said there are “no grounds” to introduce an additional tourist tax.

“Hotels are already making an enormous contribution in terms of taxes both toward central exchequer finances and supporting local authority services,” they said.

“In Dublin, for example, hotels pay approximately 1,000 euro per bedroom to Dublin City Council (DCC) in commercial rates and levies to fund local authority services which equates to over 25 million euro to DCC per annum.

“In addition to this, swathes of Dublin City centre hotels and businesses pay a further 5% levy toward enhancing the city experience for visitors, residents, and workers.

“As the country’s largest indigenous industry, tourism generates 10 billion euro annually for the economy. Economic activity from tourism businesses, including hotels, makes an enormous substantial contribution to the exchequer, generating taxes equivalent to 29 cents for every one euro spent by tourists.

“That’s equivalent to over three billion euro in taxes generated by tourism businesses for the Government each year. Given the massive cost increases over recent years, the last thing we should be doing is to increase taxes further making Ireland less attractive.”

“Placing the burden of additional taxes on international or domestic tourists, particularly at a time when we are trying to make Ireland stand out as an attractive destination for visitors, makes no sense at all.”

Minister for Arts, Culture, Media, Sport and Communications, Patrick O’Donovan, said a tourist tax was the “last thing we need to do” to add more costs to people.