Cash-strapped hotels condemn extortionate rates

Hotels in Galway already under pressure from the recession and low visitor numbers are paying the eighth highest local authority rates in the country with more than €6 million in total paid out in 2009 alone.

The figures which show the rates paid by cash-strapped hotels across the country were released by the Irish Hotel Federation (IHF ) following a two-day AGM in Galway which began last Monday. In Galway, 92 hotels paid local authority rates of €1,349.09 per room during 2009, which is over the national average of €1,317 per room. The €1,349.09 charge was applied to 4,651 rooms in Galway giving a total amount paid of €6,274,612.58.

Approximately 470 hoteliers from every county descended on the city to discuss the issues affecting the struggling industry. One of the most pressing issues was the local authority rates which the IHF says are “crippling an industry already under massive pressure”.

Newly elected IHF president Paul Gallagher told delegates on Tuesday that a survey of its members revealed that 87 per cent of respondents indicated that rates are having a significant negative impact on their business. He said that more than €80 million every year is squeezed out of the hotel and guesthouse industry in local authority rates which are set by individual local authorities without recall to any independent evaluation. The IHF is now calling on the Government to establish an ‘inability to pay’ emergency provision and a 30 per cent reduction across the rates nationwide for the sector.

“Local authorities are literally getting away with robbery at the moment. Under the law since 2001, the Valuation Office are supposed to be carrying out a revision of the rateable valuation of every rateable property in the country, and to date only two local authorities in the entire country have completed the process.

“Hoteliers are confronting these inequitable charges on a daily basis and there is no doubt they are causing serious hardship. We are willing to pay a fair rate but the delays in the revisions are too long. Our patience is gone. We need Government intervention immediately, and specifically the Ministers for Finance and the Environment to intercede now before further damage is done to our sector,” said Mr Gallagher.

Hoteliers at the IHF AGM vocally condemned the rates situation “as outrageous and extortionate”, more especially when the rates are only one aspect of the money secured from the sector. Other ‘hidden’ charges that are imposed include water rates, grease traps, waste charges, and development levies.

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