MORE than €200m could be raised if Ireland was to impose a levy on visitors, according to a new study.
Researchers from the University of Galway have explored the concept of a tourist tax as a vehicle to generate additional revenue for the Irish Government.
Their policy brief Designing a Visitor Accommodation Levy (VAL) for Ireland showed that an efficient scheme could raise revenues in excess of €200m each year.
The research was undertaken by Dr Gerard Turley and Stephen McNena from the J.E. Cairnes School of Business & Economics at University of Galway.
They used data from Fáilte Ireland's National Quality Assurance Framework registers, which contains 225,098 bedspaces as of January 2026.
“Based on a fixed tax rate per person per night, we estimate that each €1 of a Visitor Accommodation Levy would generate €44m per annum for the local authorities,” Dr Turley explained.
“A €5 tax rate per person per night would generate almost €220 million for the local government sector,” he added.
“Taking three examples from the 31 local authorities, this translates into €5.7m for Waterford City and County Councils, €8.2m for Galway County Council, and €46m for Dublin City Council.
“For hotels only, our estimates show that a €1 tax rate per person per night would generate the same revenue, circa €33 million, as a 1 per cent room tax rate per night based on 2025/26 data for the number of hotel rooms, occupancy rates and the Average Daily Rate (ADR).”
Visitor levies are already in place in a number of European cities, where local councils charge a fee for an overnight stay in their locality.
Ireland does not impose these levies but both the 2024 Dublin City Taskforce and the 2026 Local Democracy Taskforce have recommended a levy on overnight stays be introduced.
“Our research shows that revenues will depend on the categories of accommodation providers covered in the legislation, as well as the tax rates levied and any exemptions or caps,” Mr McNena, who is a lecturer in Economics at University of Galway, explained.
“The choice of tax rate is a percentage rate or a fixed rate, to be applied per person or per room.
“As both approaches have advantages, we recommend that local authorities have the discretion to choose percentage rate or fixed rate at a level that is appropriate to the local circumstances, the strength of the local tourist sector and the uniqueness of the destination.”
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