17/04/11

Varadkar's deal with airlines is an unfair sideshow says coach companies

Release to: Coach Journals
Date: April 2011
Title: Varadkar's deal with airlines is an unfair sideshow says coach companies

Ireland’s coach touring companies have said the offer from Minister Varadkar to cut the travel tax is an unfair sideshow, a PR exercise, and a capitulation to the airlines’ slick lobbying practises. Instead, the Minister should cut the tax on diesel in order to help the coach touring industry recover to 2005 levels.
The Coach Tourism & Transport Council (CTTC) points out that since 2005, the price of diesel has doubled (from €0.74 to €1.45), while the number of people taking coach touring holidays in Ireland has halved, from around 650,000 to around 293,000.

Chief Executive of Gerry Mullins says: “High diesel prices are killing the coach touring industry, and since half the price of diesel goes in Government taxes, it’s clear that the Irish Government is killing the industry.
“When the coach touring industry is healthy, the benefits are spread across hotels, restaurants and tourist attractions,” says Mullins. “So it is in the interests of the entire industry that our sector recovers. This cannot happen if the tax on diesel remains so high.”

Mullins says: “Minister Varadkar is offering a deal to the airlines: lower taxes in exchange for higher passenger volume. But the Government has already knocked €7 off the travel tax and there has been no increase in passenger numbers. What does he expect from the final €3 reduction that wasn’t achieved when €7 was knocked off it?
“It is unfair that Minister Varadkar’s proposes a deal with the airlines, but not with the coach companies. If our fuel taxes were removed we could bring an extra 300,000 visitors into the country. That’s close to half a billion euro coming into the country each year, being spread across the entire tourism industry.

The CTTC is calling on the minister for tourism to help introduce a new form of excise duty rebate. The abolition of the previous excise rebate in 2005 added 34.5 cent per litre of diesel; a massive increase that has crippled the coach industry ever since.

In the year that the rebate was abolished, around 650,000 overseas visitors enjoyed a coach touring holiday in Ireland. That number dropped to 507,000 in 2007; and in 2008 the number plummeted further to 418,000. In 2009, the last year of available figures, the number of overseas visitors taking coach tours in Ireland was down to 293,000; less than half the 2005 level.

This loss of around 357,000 visitors equates roughly to a loss of €500 million in revenue to the Irish economy. That’s more than a billion euro in lost tourism revenue since the excise rebate was abolished.