Congress Calls on Seanad Members to Reject Extension of Tax Subsidy to Low Wage Tourism Sector

7 Mar 2017

Patricia King (2) Congress General Secretary Patricia King

The Irish Congress of Trade Unions today (March 7) called on members of the Seanad to oppose a motion calling for the unlimited extension of a tax break for the tourism sector that has cost the Exchequer over €2 billion to date.

The motion is backed by Fine Gael Seanad members and calls for the tourism sector’s special 9% VAT rate to be extended and retained on a “multi-annual basis.”

Congress General Secretary Patricia King has strongly opposed the proposal, writing to all Seanad members to point out that this “de facto subsidy costs the state some €620 million per annum in VAT foregone and over €2.1 billion to date – according to Revenue figures.

“Yet, despite this large, ongoing loss to the state and its citizenry there is no verifiable evidence and not a single independent study to show that benefits have been passed on to the consumer, in the form of lower prices, or to the thousands who work in the sector, in the form of higher wages,” Ms King said.

The letter to Seanad members highlights the fact that profits have risen in the sector, with Dublin enjoying record occupancy – according to a recent PWC report – but it “continues to be characterised by a high incidence of low pay and non-compliance with labour regulations.”

Ms King pointed out that despite the huge subsidy from the state, “employers in the sector have consistently refused to engage with the Joint Labour Committee structures that are designed to raise standards in low pay areas of the economy.

“It is sadly ironic that this debate is scheduled to take place on March 8, International Women’s Day, given the high prevalence of female workers in the sector and the fact that their lot is overwhelmingly one of low pay and precarious work.”

Ms King called on all Seanad members to oppose the measure and “to help win fairness and decency for workers in the sector.”

A copy of the letter is available to download: