Dongeal and the Border counties must escape any proposed VAT increase in the Budget, according to the general manager of one of the county’s top hotels.
Carolynne Harrison from the 4-star Shandon Hotel & Spa at Marble Hill, Dunfanaghy, says any increase in the 9 per cent VAT rate would hit the local tourism sector just as it is getting back on its feet.
She said rural hotels must not be made to pay for rising costs of hotels in Dublin, Cork and Galway.
“There are a number of ingredients which has led to Donegal’s increasing success in attracting tourists here,” said Ms Harrison.
“Firstly there is the hard work of hotel owners and their staff. Here at the Shandon, the hotel was closed during the recession. Before that it was a seasonal hotel. Now we’re open all year round under a new owner and we are employing people here throughout the year.
“The creation of the Wild Atlantic Way and the reduction of the VAT rate to 9 per cent were key to helping counties like Donegal recover. However increasing VAT at this stage for rural hotels particularly in Donegal and the border counties risks putting us all back.”
Ms Harrison said the industry is already dealing with high volatility in the currency markets with the decreasing value of sterling a major issue for the hospitality sector south of the border.
“We cannot and would not charge the sort of room rates you see in Dublin now or in Galway or Cork for that matter. The vast majority of tourists coming to Ireland from outside the country are still visiting the south of the country so they can charge almost what they like,” said the Shandon manager.
“We’ve had a very good summer with high occupancy rates but we are also offering good value, with good room rates to attract customers, particularly from the UK.
“Any extra costs will only set us back again.”
Ms Harrison says she backs some suggestions from Government ministers in recent days for a new VAT rate to kick in once a room price exceeds a certain amount with suggestions of €150 or €200 per room per night being the suggested benchmark for a higher VAT rate.
“That might help tackle rising costs in Dublin and not affect us at all,” she said.
“With all the uncertainty around Brexit and the possible consequences for further fluctuations in the exchange rate, we need as much stability as possible for another year at least and that means keeping the VAT rate at 9 per cent for rural hotels.”
The Shandon Hotel & Spa closed during the recession and re-opened under new owners two years ago. The hotel recently added 18 new bedrooms. At the height of the summer season 130 full time and part time staff are employed there.
