General Industry

ITIC Protests Claims That 9% VAT Rate Is 'Deadweight'

By Dave Simpson
ITIC Protests Claims That 9% VAT Rate Is 'Deadweight'

Hitting back at Department of Finance officials who recently labelled the tourism industry's special 9% VAT rate a "deadweight" with "limited benefits", the Irish Tourist Industry Confederation (ITIC) has written to Department of Finance secretary general Derek Moran to protest the report.

According to The Irish Times, in a letter signed by ITIC chief executive Eoghan O'Mara Walsh, the confederation stated, "The 9% VAT review paper by the department is... flawed, unbalanced and inaccurate in its analysis.

"The thrust of the paper is negative towards the retention of the 9% rate... and fails to reflect [its] merits and benefits."

Increased Exchequer Receipts

O'Mara Walsh asserted, "[The report also] wholly fails to acknowledge the significantly increased exchequer receipts that the 9% rate has delivered."

While Department of Finance officials attributed the ongoing boom in inbound tourism to Ireland to foreign economic factors, ITIC said that it is a result of the reduced VAT rate.


The confederation commented, "It is disappointing that the department’s review of the 9% rate fails to state how beneficial the policy has been for the exchequer."

Tourism industry VAT receipts have increased over 50% to €1 billion since the rate's introduction in 2011.

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