Dublin City Council is keeping up the pressure on the Government to legislate for a tourist tax administered by local authorities. The latest effort was a well-publicised briefing for its councillors on the possible options, in line with a joint proposal from the four Dublin authorities last September.
The Government continues to prevaricate on the issue, which has been kicking around in its current form since 2022 when it was included in the report of the Commission on Taxation and Welfare. It was central to the Dublin City Taskforce report published in October 2024 where it was suggested as a method of funding the initiatives to rejuvenate the city centre contained in the report
The interdepartmental subgroup set up to provide a “course of action” to implement the taskforce’s recommendations established a sub-group to work up a proposal.
“The subgroup, led by Department of the Taoiseach is considering all aspects to a visitor accommodation levy,” the Minster for Enterprise, Tourism and Employment, Peter Burke told the Dáil in January.
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The arguments against a €5 levy put forward by the hospitality industry holds little water in a city where average hotel room prices are €250. The Government is doubtless mindful that the hotel sector is not expected to be included in the VAT cut on hospitality, due to come into effect in July.
Resistance to the idea may have more to do with the Government’s control over the purse strings of local government. Ireland is unusual in Europe in that the ability of local authorities to raise funds is circumscribed, with more than 50 per cent of funding coming from central coffers. The management of their own affairs, particularly planning in the 80s and 90s, has not helped local authorities’ argument for greater autonomy.
A tax to fund the promotion of tourism and the improvement of the city has its merits. As Dublin City Council points out , 21 out of 27 EU member states have one. But the vital issue is that it must lead to visible improvements in the city, to the benefit of both locals and tourists, as well as effective tourism promotion.
