Should we have a tourist tax?
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What is Ireland’s proposed tourist tax, and who would have to pay it?
Now, if you regularly holiday abroad, you might be familiar with paying a tourist tax on your hotel bill. Ireland doesn't have one, but a new study by researchers at the University of Galway suggests that a visitor accommodation levy could raise over 200 million euro a year for local government. But who would pay it? How would it work? And could making holidays in Ireland more expensive make us less attractive to visitors? Joining me now is Dr. Jared Turley, co author of the report and lecturer in economics at University of Galway. Jared, good morning, too.
Good morning, David, and good morning to your listeners. Thanks for having me on the show.
Well, thanks for joining us. A visitor accommodation levy. What is it and why introduce it now?
Ah, okay, so why introduce it now? I guess it's because it's very popular, as you said, as you alluded to, not just in Europe if you're going on your holiday, but North America, in fact worldwide, lots of countries have it, usually at the municipal level. Um what is it? It i it is it's a tax on um overnight paid accommodation. It's called different things. It could be called a municipal levy, a local tax, a city tax, but you're taxing overnight paid accommodation. It's tourist tax.
Yeah, tourist tax. So uh obviously it would apply to um visitors from overseas. If I go to Galway, do I have to pay it? Or what I think is that you're not going to be able to do that. It
depends on yeah, it depends on the design. Uh we would advocate you should. Uh 'cause if you start making exemptions, if you exempt local residents, uh residents from Ireland, uh those going for a medical treatment, then you're going to have to probably charge a higher rate to bring in more revenue. So like with all taxes, in general, a broad base tax, so the fewer the exemptions Allows you to charge a lower race. So yes, all visitors, whatever purpose, wherever they're coming from.
Okay, boo hiss.
How much could a tourist tax raise, and what accommodation would it cover?
Uh now, um you're you're talking about just for the I think for the purposes of of the research, um a five euro charge per person per night. Now that you say could raise around two hundred and twenty million euro a year. How how did you arrive at that figure?
Yeah, so we did different simulations. We did some last year, we did some this year. So we tried one euro and three euro last year. Then we had an error go this year at at at two euro, three euro, and five euro. And that's that's the rate. And with like any tax revenue, you just multiply the rate by the tax base. So you have the rate, which I presume will be at the discretion of the local authority, and then the base, the tax base. is bed spaces, occupied bed spaces. So we got that from Falture Ireland. The problem with bed spaces in Ireland is unlike in other countries where you have a single comprehensive register of bed spaces, we don't have that in Ireland. And anybody who knows about short term lets,
yeah,
we don't have the register for that. So we don't we don't incl we don't include everything. We can't include everything. But You know, what we do include are the things that you would imagine, which is hotels, bed and breakfast, guest houses, caravan and camping, uh self catering, uh hostas.
Yeah. So it's not possible to include short term nets. Um that would make any scheme even more unpopular and we'll he hear from hoteliers in a minute, but it would make it even more unpopular with uh hoteliers, I would imagine.
Yeah, but there's I I mean it w as I said before, once you allow an exemption, others are going to try and make the case for exemptions. So it makes it all the the ha all the more harder. You're going to have a limited tax base. So we would argue have as few exemptions as possible. We've seen from the Scottish experience There are national exemptions but very few of them and then you can have a a local exemption, but very few of the local councils in in in in Scotland have introduced local exemptions. Glasgow has gone for the full um national exemption and that's all.
Okay.
How common are tourist taxes in Europe, and how could Ireland set the rate?
Uh so I mean as you say, they they are fairly common abroad and I I mean people any anybody, as I say, who's who's gone on holidays abroad will probably be familiar with paying them.
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Chapters
8 chapters
1
What is Ireland’s proposed tourist tax, and who would have to pay it?
0:00–1:53
2
How much could a tourist tax raise, and what accommodation would it cover?
1:53–3:57
3
How common are tourist taxes in Europe, and how could Ireland set the rate?
3:57–6:04
4
Would a tourist tax make Ireland less competitive with other destinations?
6:04–8:18
5
How could Ireland introduce a tourist tax through local authorities?
8:18–9:57
6
Why does the hotel industry oppose a tourist tax on Irish visitors?
9:57–13:06
7
Would a tourist tax deliver better local services or simply add to costs?
13:06–13:28
8
How could unregistered accommodation be included in a fair tourist tax?
13:28–15:16