Offsetting tourism costs: Local levy for bed nights

The country’s city and county council leaders should tune in to the debate that’s been opened in Edinburgh, where there’s a proposal on the table for a “transient visitor levy” or tourist tax of either 2% or €2.25 per night at hotels and other accommodation.

What’s commonly known in Ireland as the tourism tax is in fact no such thing, since Vat for the tourism and hospitality sector which was lifted from 9% to 13.5% in Budget 2019 is simply a straightforward sales tax paid by residents and tourists and passed on to the Government to spend as it deems fit.

Tourist or bed taxes are paid , as the Edinburgh proposition makes clear, only by visitors and the revenues for local, not central governments, are used in part to offset the costs of tourism, such as street cleaning and park management, and for the care and maintenance of the historic buildings and other attractions visitors come to see.

They are also far from un common in Europe and are levied in Spain’s Balearic Islands, Paris, Berlin, Cologne, Amsterdam, Rome and Venice. Catalonia’s tourist tax has raised €126m since its introduction in 2012. Edinburgh’s council thinks it could raise €12.4m annually.

Another feature of these taxes is that they are always opposed by the associations representing the tourism and hospitality industries, none of which, so far, have been able to explain satisfactorily why they fear holidaymakers who can find thousands of euro for flights and hotel stays will think twice about paying an extra €2, or even €5, a night. It is, almost literally, peanuts.