A simple way to boost government tax take by up to 5 billion

[seabhac siulach]

Taking figures for 2008, we find that:

"Irish residents spent a total of €1,799.2m on foreign travel in Q2 2008, up just over 4% from Q2 2007. Holiday expenditure was down slightly at €1,279.6m. Expenditure on Business trips increased by just over 16% to €238.7m, as did expenditure on Visiting Friends and Relatives, which was up by 25.6% at €198.9m."

Extrapolating from Q2 of 2008, we can estimate that the total expenditure by Irish people on holidays abroad amounted to some 5 billion in 2008.

This is 5 billion lost to Ireland, with this money flowing instead into the tax coffers of Spain, Australia, etc., where these holidays are taken. This is money now desperately needed in the country...(with talk of desperate cutbacks,etc.).

In this dire economic situation, there is a need for alternative solutions. One simple method of raising tax would then be to exhort Irish people to stop making so many foreign holidays (at least for a year of two). This would be a valid appeal to patriotism!
Of course, to the less patriotic among us, ahem, the government could(should) add an incentive by offering each tax payer a one-off tax-free voucher of, say, 100-200 euro for those willing to book holidays in Ireland (cost approx. 200-400 million, assuming all tax payers avail of it)...the aim being to keep the holiday money in Ireland by whatever means (the government would soon recoup most of this 200 euro from consumer and other taxes on the resulting increased money supply in the economy,etc.). Keeping even one fifth of the 5.2 billion spent abroad last year in Ireland would be akin to boosting our national GNP by this amount (which is not a trivial number in the context of the size of cuts the government is proposing). While foreign travel is likely to decrease to lower levels this year than 2008, there must still be large incentives to ensuring that Irish holiday money stays in Ireland! The 200-400 million cost of any such tourism stimulus would be low compared to the 1.5 billion (criminally) wasted on the Anglo Irish Bank capitalisation, etc.

One problem (at least): would incentives like I have outlined above be considered as illegal government aid under international trade rules?

Anyhow, just an idea...

[Oppenheimer]

Its a fantastic idea, if it could save that much then an amount of up to even €50million could be used to subsidise the costs. The principal reason, bar the weather, that people go on foreign holidays is hotel, food and other costs, like car hire etc.. If either you appealed to the same patriotic sense among accommodation owners, hoteliers, restauranteurs, etc.. or subsidised them to reduce their costs I reckon your on to something.

[Mazzy Maz]

Would the EU allow something like? Would it not be seen as distortion of the common market?

[Oppenheimer]

I don't think the EU would be likely to intervene. Here's a thought - how is Gormless' subsidising his wacky €1000 for a bike deal? That mechanism could apply, if the subsidy was given in lieu of taking an airline flight, which is bad for the environment so it is not a domestic holiday initiative its a "save the planet" initiative.

Now, if the Govt. were clever they'd sell Aer Lingus to Micko just before they let him have wind of this initiative!

[seabhac siulach]

Its a fantastic idea, if it could save that much then an amount of up to even €50million could be used to subsidise the costs. The principal reason, bar the weather, that people go on foreign holidays is hotel, food and other costs, like car hire etc.. If either you appealed to the same patriotic sense among accommodation owners, hoteliers, restauranteurs, etc.. or subsidised them to reduce their costs I reckon your on to something.

Yes, of course, one would need to, let's say, 'encourage' those in the domestic tourist industry to reduce profiteering, etc. One of the reasons we (as a nation) are in the mess we are in is the toothlessness of the National Consumer Agency. A first step would be to give the NCA enforcement powers to stop price fixing, profiteering and cartels.

[cyberianpan]

And if other countries followed our lead ?

cYp

[odie1kanobe]

Not such a crazy idea and the best way to do it would be via a Voucher sent to all taxpayers as unemployed should be looking for a job not taking a holiday.

Voucher entitles taxpayer to €200 worth of accommodation in Bord Failte registered establishment.

[Middleaged]

Why the Voucher?, if you holiday in Ireland you'll most probably stay in Hotel/holiday home all highly tax incentivised in the past,(Section 23, seaside etc...)

Why subsidise more?

[seabhac siulach]

And if other countries followed our lead ?

cYp

I suppose if one considers foreign travel (by Irish people) to be akin to an import (from the foreign countries travelled to) then any form of aid as I propose might be considered as a trade tariff...
If other countries followed our lead it would be equivalent to the raising of tariffs. Does this make it illegal? I don't know...
If Failte Ireland encourage, through advertising, the same idea that Irish people can/should holiday at home (as they do), is this not the same thing, i.e., the use of government money (in advertising) in order to keep tourist euros in Ireland.

Edit: Of course, how is this idea of 200 euro vouchers any different from the stimulus idea being promoted by Obama in the US (and elsewhere), i.e., handing everyone there a tax-free credit of a few thousand dollars, etc. in order to boost DOMESTIC consumption?

[odie1kanobe]

Why the Voucher?, if you holiday in Ireland you'll most probably stay in Hotel/holiday home all highly tax incentivised in the past,(Section 23, seaside etc...)

Why subsidise more?

Reason for voucher is control as don't want people taking it and going off to Tralee to get pissed all weekend. Using local hotels / B&B tends to keep money in the locality.