The marine leisure sector is worth over €750m per annum in sales and services, €430m of which is directly derived from tourism. The IMF says the Government can take immediate steps to make the sector more competitive. In 2006 the VAT contribution from new boat sales alone contributed more than €21m to the Irish exchequer. A reduction in the VAT rate to the same level as our nearest competitor, a competitor just 120 kilometres away from our largest centre of population, would help to level the playing field.
Other factors, such as the high cost of energy in Ireland, are contributing to the industry’s difficulties, the IMF pointed out. A reduction in the VAT rate on accommodation to 13.5% would help to make our tourism product more competitive and bring it into line with our European partners. Unless immediate action is taken, the IMF warned that the sector will have to rely almost exclusively on the home market to bolster declining international tourist numbers.