Tourism chief warns rising hotel prices could make us less competitive
Concern about hotels that record "very large profits" being able to avail of the special 9pc Vat rate have been expressed by Tourism Minister Shane Ross.
While he urged that there should be no attempt to raise the tourism VAT rate in October's Budget - because it had been a "great success" in terms of creating jobs - Mr Ross accepted that hotel price rises now risked damaging Ireland's tourism reputation.
He said: "There is a cause for concern about hotels at the top, who are making very large profits, getting 9pc VAT and we'll have to watch that. But the idea of doing anything about it overall would be very, very difficult to contemplate."
The minister said the country's reputation as an affordable destination had been hurt during the Celtic Tiger years and had taken six or seven years to recover.
He warned: "We've got to be very vigilant about it slipping back again.
"The prices of Dublin hotels are causing some concern. I hope it won't damage our reputation in any way."
The CEO of Tourism Ireland, Niall Gibbons, said his organisation was very focused on competitiveness and that it was important to look at the cost of holidaying as a whole.
He explained: "It's important to look at the overall package. The cost of getting here is still very good.
"There is still very good value on the ground, particularly in rural Ireland."
However, Mr Gibbons also admitted to being "concerned about accommodation prices in urban areas in the last year or two".