One of the country's leading trade unions has called on the Government to abolish the VAT tax break for hotels and restaurants because workers are not benefiting.
Siptu, according to a report in the Irish Independent, is urging the Government to scrap the current vat rate of nine per cent on the back of a stellar year for Irish tourism so far in 2015.
In 2011, VAT was cut from 13.5 per cent to nine per cent for the hospitality sector in an attempt to bolster tourism and employment in the industry.
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Siptu believes that employers in the sector needed to ensure workers are also benefiting from the upturn in tourism this year.
"When the Government has sought to ensure that workers also benefit from this upturn, through the creation of a Joint Labour Committee for the hotel and restaurant sector, the employers' groups have refused to engage," Siptu division organiser, John King, told the Irish Independent.
"The Government must state clearly that if the Irish Hotel Federation and the Restaurant Association of Ireland continue to subvert Government policy in this area, the preferential VAT rate for the hospitality sector will be ended in the October Budget.
"This situation needs to be tackled now, otherwise the Government's entire strategy on protecting low-paid workers is in real danger of being undermined,” he added.
King said that despite the overwhelming evidence of a significant upturn, employers in the sector represented by the Irish Hotels Federation and the Restaurant Association of Ireland are "defying Government policy and refusing to engage in the Joint Labour Committee process which seeks to ensure workers receive a fair day's pay for a fair day's work."
It’s being reported that the Restaurants Association of Ireland chief executive Adrian Cummins has labelled Siptu's proposal as "outrageous", stating that the Government needs to maintain the nine per cent VAT rate for hotels, restaurants and businesses in the hospitality sector to help sustain growth.