Crippling local authority rates emerged as a key issue causing severe hardship for hoteliers at a recent crisis meeting held by the Irish Hotels Federation (IHF ). Westmeath members expressed outrage at the exorbitant rates imposed and demanded that, due to their inability to pay in the current climate, an emergency provision should be brought in to immediately reduce rates by 30 per cent for hotels and guesthouses. This would be in line with the recent result of the revaluation of hotels and guesthouses in the South Dublin County Council area completed by the Valuation Office.
Hoteliers condemned as outrageous and extortionate the levels of local authority rates paid by hotels. The IHF bases the call for a rates reduction on the fact that the revaluation carried out by the Valuation Office of all commercial premises in the South Dublin County area resulted in a reduction of approximately 30 per cent in the local authority rates liability of hotels and guesthouse. Therefore, it maintains that this level of reduction should be applied across all local authority areas until the revaluation process is completed in each local authority area throughout the country.
According to Joe O’Brien, chairman, Midlands’ branch of the IHF, hotels and guesthouses are disproportionately subsidising the rates liability of other business premises. He states that hotels and guesthouses are being penalised by an antiquated taxation system of commercial rates that sees local authorities extract taxes relative to the size of premises without any recourse to the level of turnover or overheads of the business.
“Our members have been paying rate increases year on year without recourse to independent assessments. We have been asking too long for this issue to be addressed, and it hasn’t been addressed. Excessive local authority rates are having a devastating effect on hotels which are already struggling to deal with decimated revenues and cost bases that have not yet adjusted to the changed economic reality on the ground. Our members are willing to pay a fair and equitable level but simply can no longer bear the current rates that are imposed in this unprecedented environment when a revaluation process should be completed,” says Mr O’Brien.
“We are calling for the introduction of emergency provisions to allow for a 30 per cent reduction in local authority rates applicable to hotels and guesthouses until such time as these properties have been revalued as provided for in the Valuation Act 2001. Only one local authority area in the entire country has completed this process in seven years – we can no longer wait for the Valuation Office to complete this countrywide process given the dire circumstances our members are facing.”