Media

Chancellor Misses A Trick With Halloween Budget Says NI Tourism Alliance

Posted 31 Oct, 2018

Chancellor Philip Hammond is failing Northern Ireland’s billion pound tourism sector by failing to act on the increasingly urgent issues of tourism VAT and Air Passenger Duty (APD), according to Northern Ireland Tourism Alliance.

Chancellor Philip Hammond is failing Northern Ireland’s billion pound tourism sector by failing to act on the increasingly urgent issues of tourism VAT and Air Passenger Duty (APD), according to Northern Ireland Tourism Alliance.

Those missed opportunities could cost the sector dear, says Doreen McKenzie, Chief Executive of NITA, the umbrella group which represents key public and private sector players within the industry.

“Our industry is moving ahead with incredible speed,” she says, “But we have a lot of lost ground to make up for and we desperately need positive long-term action on those issues which are currently acting as barriers to development.

“Of course we welcome the headline-grabbing good news of a significant increase to Northern Ireland’s block grant, a cash injection into Belfast city centre and multi-million investments in City Deals, but we need policy changes every bit as much.

“Ours is an industry which desperately wants to play its full and active part in the growth our economy but our hands are tied as, currently, the issues of tourism VAT and APD are massive obstacles in our path.

“The UK's 20% tourism VAT rate which is amongst the highest in Europe is an ‘albatross around the neck’ of our local tourism professionals who are keenly aware that, just across the border, the Republic imposes a rate of just 13.5%. As Brexit looms, consternation grows about how our local industry will manage this imbalance as well tackling as the many other issues which will inevitably arise. Clearly, a review of tourism VAT is urgently needed and we are calling for the Chancellor to help is formulate a new Strategy for Success.”

NITA is equally critical of the lack of progress on Air Passenger Duty, the tax levied on every passenger travelling on every flight departing from airports in the United Kingdom. It’s the highest tax of its kind in the world and, here again, Northern Ireland compares less than favourably with its neighbour, as Doreen McKenzie highlights.

“The effects of the UK’s exorbitant APD rate are desperately damaging to our growth prospects and our airports have been particularly handicapped since the equivalent tax in the Republic of Ireland was set at £0. A cut in APD could instantly and dramatically improve our connectivity and support our tourism industry by creating a more level playing field.

“We welcome the Chancellor’s reassurance that there will be no change in short haul APD rate and only inflationary increase on all other routes. However, we are disappointed that, with Brexit just months away, he refuses to see that Northern Ireland needs particular support and, instead of providing that, continues to hide behind EU requirements.

“The Chancellor’s announcement of the formation of a working group to examine short-haul APD in Northern Ireland feels like his is kicking the can further down the road, avoiding the necessary decision to abolish, or even reduce, this counter-productive ‘tax on tourism’. As an industry-wide representational organisation which has already campaigned on this issue, funding important research which has supported our case, we do not intend to give up now. We look forward to constructive engagement with HM Treasury which will see APD properly addressed as we all prepare for the post-Brexit economy.”