Rates inaction condemned by hoteliers

The Irish Hotels Federation (IHF) has criticised what it terms inaction by Minister John Gormley in addressing the issue of excessive local authority rates levied on hotels, which it claims has amounted to an unacceptable derogation of duty. Paul Gallagher, president of the IHF, said that the situation had reached a tipping point with hotels and guesthouses across the country now being served with legal notices demanding full payment within six days under the threat of district court summonses. “There has been a complete unwillingness to engage on the issue from the top down,” said Mr Gallagher. “The cashflows simply do not exist to meet these payments.” The hotel and guesthouse sector represents only 1.5 per cent of national GDP but is required to pay six per cent of the country’s total rates bill. In light of worsening trading circumstances, the IHF has appealed to Minister Gormley and the local authorities to introduce a 30 per cent waiver of rates for hotels and guesthouses pending the completion of the countrywide revision of valuations by the Valuation Office. “The hotels sector is unfairly subsidising other commercial ratepayers through excessive rates,” added Mr Gallagher. The IHF states that hotels make a disproportionate contribution to local authority funding with many hoteliers being levied rates of up to €2,500-€3,000 per bedroom every year. The country’s 900 hotels, pay approximately €90 million a year to local authorities, equating to an average of €1,500 per bedroom, regardless of trading circumstances. Hotels no longer have the earnings to pay these rates, Mr Gallagher said.