- ITIC has called for targeted Budget 2027 support for Ireland’s tourism industry
- Tourism supports around 70pc of its employment outside Dublin
- Ireland ranks as the second most expensive EU country for competitiveness
- The sector faces a shortage of 10,000 to 15,000 hotel rooms
- Employment in accommodation and food services fell by 16,300 jobs in Q1 2026
ITIC’s “Budget 2027” submission argues that Irish tourism, an indigenous, labour-intensive export sector employing many people outside Dublin, needs Budget 2027 action to protect jobs and enable the growth targets in the national strategy “A New Era” (+50pc revenue by 2031, 250,000 tourism jobs, and -45pc emissions).
The 2027 submission has called for targeted support for Ireland’s largest indigenous industry and biggest regional employer amid geopolitical and macroeconomic uncertainty. Tourism generates most of its revenue from international visitors and supports around 70pc of its employment outside Dublin, making it vital for rural Ireland. ITIC outlines four key Budget asks focused on competitiveness, capacity, connectivity and investment. These aim to underpin the sector’s ability to meet ambitious targets in the Government’s “A New Era” tourism policy, which seeks a 50pc rise in revenue by 2031, employment of 250,000 and a 45pc cut in emissions.
Economic context highlights Ireland’s exposure as a small open economy. The Summer Economic Statement allows an €8.5bn Budget package, yet risks from energy costs, global uncertainty and reliance on a narrow tax base persist. Industry performance shows a mismatch between CSO data suggesting strong growth and business feedback of softer demand outside North America. Rising costs of labour, energy, insurance and other inputs are squeezing margins. Employment in accommodation and food services fell by 16,300 jobs in the first quarter of 2026 compared with the previous year. Fáilte Ireland’s barometer indicates many businesses report lower revenues year-to-date and expect further declines.
On competitiveness, Ireland ranks as the second most expensive EU country. ITIC recommends limiting any minimum wage rise to inflation, targeted PRSI relief for labour-intensive SMEs, energy charge reviews, insurance reforms, extension of the 9pc VAT rate to attractions and activity providers, and alcohol excise reductions. Capacity constraints include a shortage of 10,000 to 15,000 hotel rooms. Recommendations cover capital supports for hotel development, staff accommodation, regional conference infrastructure and Dublin Airport investment. Connectivity priorities include capital funding for Shannon and Cork airports via the Regional Airports Programme, support for sea access, improved public transport to airports and expanded EV infrastructure. Investment calls seek an extra €50m for tourism, greater overseas marketing, skills funding from the National Training Fund surplus, sustainability grants and enhanced business events support. ITIC concludes that Budget 2027 offers a critical opportunity to enable sustainable growth through pro-enterprise policies, benefiting visitors, communities, the industry and the Exchequer.
It sets out a backdrop of high uncertainty (geopolitical and macroeconomic) and rising “cost of business” pressures (energy, labour, insurance, regulation), with demand becoming mixed across source markets. While some official CSO figures suggest tourism revenue increases, industry intelligence and surveys report weaker trading, revenue pressure, and job losses (CSO employment declines in accommodation/food services).
ITIC’s core asks for Budget 2027 are:
- Competitiveness: Tackle rising costs and maintain value-for-money. Key areas include implementing Cost of Business Advisory Forum recommendations (notably energy charge consolidation/pausing pass-through increases), moderating minimum wage increases (no more than inflation) and targeting employer PRSI relief for labour-intensive SMEs, improving VAT competitiveness (including conference cost VAT treatment), and acting urgently on insurance premium reform. ITIC also calls for aviation cost competitiveness (airport charges/tax), and various targeted tax/rule changes (e.g., tips/gratuities tax treatment, permit rule reform).
- Capacity: Address a projected structural hotel shortfall (Crowe/ITOOA estimate of 10,000–15,000 additional rooms needed). ITIC urges faster, region-focused delivery of accommodation via measures such as capital grants, reduced development levies, time-limited tax incentives, state-backed financing, and reviews/support for staff accommodation, plus planning/infrastructure certainty and tourism amenity investment.
- Connectivity: Support air and sea access and improve intra-island transport. ITIC recommends direct capital funding for state regional airports (Shannon and Cork) via an expanded Regional Airports Programme, as well as completing/strengthening public transport links to airports (e.g., Metro North delivery, Cork airport rail/light rail and Shannon mainline link) and expanding EV charging and better taxi market arrangements.
- Investment: Increase Government tourism funding to enable the 2031 policy goals. ITIC says tourism currently receives about €233m/year and recommends an additional €50m annually, alongside stronger support for overseas marketing, regional visitation, sustainability/retrofits, recruitment and visa facilitation for shortage roles, AI-readiness and digital upgrades, and improved funding for business events (including association conference competitiveness/subvention). It also highlights the National Training Fund surplus as a potential source for labour-intensive sector skills investment.
ITIC concludes that Budget 2027 should provide a clear roadmap for pro-tourism, pro-enterprise, sustainable growth by focusing on competitiveness, capacity, connectivity, and investment, benefiting visitors, jobs (especially regionally), communities, and the exchequer.
Eoghan O’Mara Walsh shared “tourism generates most of its revenue from international visitors and supports around 70pc of its employment outside Dublin. Budget 2027 offers a critical opportunity to enable sustainable growth through pro-enterprise policies”
