The rise in rates imposed on Donegal businesses could lead to job losses in the tourism industry in the county, a leading hotelier here has warned.
The chair of the Irish Hotels Federation in Donegal has said that the 5 per cent increase, combined with other disadvantages that hotels in the country are facing, could see jobs lost.
Paul Diver, who is owner of the Sandhouse Hotel in Rossnowlagh, said the move has increased the problems that hotels here are already suffering due to the legacy of the economic downturn, and a rates disadvantage with other parts of the country.
Last week Donegal County Council passed a budget that will see a 5 percent increase in commercial rates for the top 10% of ratepayers.
The deal was struck to avoid cuts in services as the council sought to find €1.5m to balance its books.
Mr Diver stressed that Donegal County Council has been very supportive of tourism in the county in recent years and said he hopes the combination of factors will not see jobs lost.
He warned the increase will see hotels that were hoping to add improvements think twice or postpone work until the impact of the added costs becomes clear.
“I am very concerned given the fact that other parts of the country have had their rates evaluated and they have come down on average 33 percent,” he said.
“While we do acknowledge that Donegal County Council has been very supportive of tourism and invested a lot in tourism, this has to put a lot of hotels under pressure. There was no investment in hotels during the recession. This increase will hinder hotels who are investing in refurbishments and improving their products. Why tourism has recovered a lot, there is a legacy of debts and issues and this increase is very worrying.”
He said hopefully the increase will not lead to job losses in Donegal hotels but he is worried that it could
“Hotels that have earmarked refurbishment programs are now going to have to scale back or defer it.”
Mr Diver said hotels in other parts of the country that have had the rates evalution are still able to invest, putting them at an advantage over Donegal hotels.