Excessive prices in the tourism industry are coming from a "small minority," according to the Irish Tourist Industry Confederation (ITIC).

Last week, following confirmation of Taylor Swift's concert dates in Ireland, a number of hotels put their prices up.

Minister for Public Expenditure Paschal Donohoe urged hotels in Dublin to do "the right thing" and not charge extortionate prices.

Environment Minister Eamon Ryan said prices were "shocking".

Speaking to Newstalk Breakfast, ITIC Chief Executive Eoghan O'Mara Walsh said there are "excessive prices being charged by a small minority of hoteliers and tourism operators."

"The vast majority are very responsible in terms of pricing and in terms of value for money, but it's the small minority that catch the media headlines and they're the ones that give us a bad name," he said.

Market competition

Mr O'Mara Walsh said the use of hotels for those seeking international protection has come at a price for the "broader tourism industry"

"Fäilte Ireland estimates that for every €1 a tourist spends on accommodation, €2.50 is spent on ancillary tourism services," he said.

"The wider tourism industry - the restaurants, the pubs, the attractions, the cultural experiences - they're all missing out on the tourism dollar and that's going to be a huge issue this summer.

"Government are over-reliant on the tourism accommodation.

"The hotels and guest houses and B&Bs, they're doing okay, because they get a cheque every month or every three months that they're doing okay, but it's the downstream tourism businesses that really feel it."

VAT

The reduced VAT 9% rate on restaurant, cafe, catering and tourism services is something that should remain across the whole sector, according to Mr O'Mara Walsh.

"The excessive prices that have been referenced are the minority of hotels and often are unfortunately in Dublin," he said.

"The majority of hoteliers in regional Ireland are charging very, very fair prices and the 9% is equally applicable then.

"You can't slice and dice the VAT rate geographically, so it has to be 9% across the whole country - I think it's the right rate, I think it's the fairest."

A bespoke piece of sand artwork commissioned as part of the Fáilte Ireland ‘Keep Discovering’ campaign. Image: Andres Poveda Photography

Mr O'Mara Walsh said the 9% VAT leaves Ireland on a "competitive keel."

"Every other cost of business is way out of kilter with our European peers," he said.

*If the 9% becomes the 13.5%, the vast majority of those 20,000 businesses in this sector have very modest profit margins and they would have no choice but to pass on the bulk of that VAT increase, if not all of that VAT increase, to the consumer.

"The best thing Government could do is increase supply [through] enabling additional development of new hotels, or else finding an alternative plan for housing refugees and asylum seekers."

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