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Jonathan Bell meets Tory counterpart about cutting VAT rate for tourist spots, bars and hotels
March 21, 2016
Colin Neill, chief executive of Hospitality Ulster, said: “The rate of Vat is critical, particularly in the Northern Ireland context. We are the only part of the UK that has to compete with somewhere with a land border with a lower rate. It’s a price sensitive industry. We are trying to compete directly (with the Republic) and especially closer to the border.
“Our main markets are domestic, England and the Republic. (People will say) why spend more money in Northern Ireland?
“We have been pushing. We have asked for 5% on accommodation, food and visitor attractions. Even if we got 9%, it would be a level playing field and would make an incredible difference.”
But Mr Bell reiterated concerns that a cut in the rate could not be applied just to Northern Ireland, and would have to be introduced right across the UK.
“Unfortunately Her Majesty’s Government has held a consistent line that such a change could not be applied exclusively to Northern Ireland, and that the Government had no plans to introduce a reduced rate of Vat for tourism across the UK as a whole.”
Janice Gault, chief executive of the Northern Ireland Hotels Federation, said the disparity between the tax rates is the biggest problem the industry faces here.
“We believe we have put forward a good argument,” Ms Gault said.
“We would be happy for (a tax drop) for hotel bedrooms in the first instance, then moving on to food and drink.”
According to a study by Hospitality Ulster, after the introduction of the 9% tourism Vat rate in the Republic, visitor numbers have increased by one million.