Ross backs 0pc VAT rate for tourism and calls on people to take ‘staycations’ this year
TOURISM Minister Shane Ross has backed a 0pc VAT rate to help the sector recover and insisted: “There are going to be holidays in Ireland this year.”
But he says ‘staycation vouchers’ are unlikely to happen any time soon as he is confident there will be pent-up demand for breaks.
Speaking exclusively to the Irish Independent, Mr Ross acknowledged that Irish tourism is currently “on its knees” and “dramatic measures” are needed to save it.
One of those measures could be a reduction of VAT for Irish tourism and hospitality businesses from 13.5pc to 0pc. Mr Ross says this is something he and Minister of State for Tourism Brendan Griffin agree on.
“I’ve made that clear at Cabinet... I’ve met [Finance Minister] Paschal Donohoe several times, and we’ve made it perfectly clear that’s what we’re looking for,” he said.
“I mean 0pc of 0pc isn’t much at the moment... but when things start picking up, the tourism industry is going to need a lift, and I think that would send a very strong signal that we have their interests at heart.”
He was speaking as the Central Statistics Office confirmed a drop of 831,000 (56.7pc) in passengers travelling to Ireland in March 2020 compared to the same month last year.
A tourism recovery taskforce will also be unveiled this week, Mr Ross said, with an independent chair and around a dozen members including representatives from Fáilte Ireland and Tourism Ireland.
It will also include business and industry stakeholders “who have worked at the coalface and are recognised as achievers”.
“It will be up to them to come up with a plan,” he said.
That recovery plan will be published “hopefully in eight weeks”.
The timeframe is unlikely to satisfy tourism and hospitality businesses that have been shuttered since mid-March, and are issuing increasingly desperate calls for guidelines and supports. The industry faces “a catastrophic outlook”, the Irish Hotels Federation (IHF) has said.
But Mr Ross said: “I don’t think it’s going to be too late because, quite honestly, the tourism industry is going to start slowly. It’s not going to be first out of the traps... I don’t think eight weeks time will be too late for that.”
Staycations are likely to recover first, he added, driven by pent-up demand, a wariness of overseas travel, and Ireland’s “wide-open spaces”, beaches and greenways.
“Ireland has magnificent holidays where there is a lot of space. You don’t have to go to a crowded place… There is an awful lot of space in Connemara
and Killarney and places like that, and I think people will come to and from Ireland with open arms.
“There are going to be holidays in Ireland this year, I hope and am confident of that. Let’s get Irish people going to Ireland and appreciating Ireland, that would be a really good start.”
The idea of State-sponsored ‘staycation vouchers’ has been mooted as a stimulus measure to kick-start home holidays, but this is not under active consideration.
“It’s basically underwriting a holiday immediately... I’m not sure that’s necessary at this stage. The other measures are going to be very strong and extremely worthwhile. But I wouldn’t rule it out,” he said.
Mr Ross (70) is an outgoing minister who lost his seat in the February 8 General Election, so won’t form a part of any future government. Being a caretaker minister in a pandemic is a strange position, but he said there are advantages in that he no longer has to “think politically”.
Given the scale of the challenge facing tourism, the 260,000 jobs and €7.5bn revenue it provided last year, according to Fáilte Ireland, he was asked whether the next cabinet should include a dedicated minister?
“I don’t see any need for change. At the moment you have two ministers for tourism, in effect. If we start creating ministers for every sector that becomes highlighted or in big trouble, I think it would be appropriate maybe today, but in a few years’ time, it would be another minister and you’d have to move around again.”
Speaking about the pandemic, he said: “Anybody who says that they know when such-and-such is going to open, or when it’s going to happen, they just don’t know.
“We just haven’t a clue where the virus is going to be at a certain day and a certain time. We have a prediction, but it’s not an exact science... we have to be fairly flexible, but absolutely determined.
“I was there for four years, and it was a really positive experience in terms of tourism, the figures just kept going up and up.
“That was a real joy... due not just to the prosperity of the nation... due to the fact that we had a really good spirit, a good product and we were selling it very well.
“And that’s all been completely knocked for six by this virus.”
‘Let’s get Irish people appreciating Ireland, that’s a good start’