Hoteliers here are reporting occupancy rates of between 23 and 26% for the summer months, according to figures from the Irish Hotels' Federation. 

This is based on confirmed bookings and compares to an average 90% occupancy over the summer months last year.

The IHF said that occupancy for September, traditionally a popular time for US visitors, currently stands at 22%.

Elaina Fitzgerald Kane, the IHF president, said the substantial drop in occupancy levels highlighted the unprecedented challenges facing the sector and the requirement for immediate interventions to support tourism businesses.

She said the move by the UK government to cut the VAT rate there from 20% to 5% was a clear sign of their commitment to support the recovery of their tourism and hospitality industry. 

"Given how closely our economies are intertwined a similar cut here is necessary. The UK is not only our biggest market for overseas tourists, it is also our biggest competitor," she said.

Almost 90% of hotels across the country are expected to be open again by the middle of the month. 

Ms Fitzgerald Kane said that hotel and guesthouse owners have been heartened by the strong support from people who are taking a "staycation" this year. 

However, she said this continues to be a critical time for the tourism industry and the almost 270,000 livelihoods it supports.
 
The IHF is calling on the Government to implement the following measures as a matter of urgency - the continuation of the wage subsidy scheme and inclusion of seasonal employees, a reduction in the tourism VAT rate to 5% until December 2021, new liquidity measures and the extension of the three month waiver of Local Authority rates and charges.

The group also said that the size of gatherings should be linked to venue capacity as opposed to an arbitrary cap on numbers. Greater clarity is now urgently required for gatherings beyond July, it added.

"Time and again, tourism has proven itself as a hugely successful engine for economic growth, particularly in regional Ireland. In the aftermath of the last recession, tourism created 90,000 new jobs. Last year alone it generated over €9 billion in revenue," the IHF president said. 

"We are committed to working closely with the Government and with Minister Catherine Martin to safeguard tourism, Ireland's largest indigenous employer, so that it can play a key role again and be a significant lever in the country's economic recovery," she added.

Call for cut in hospitality VAT rate 

The chair of the Tourism Recovery Task Force says reducing VAT is an opportunity to stimulate demand.

Ruth Andrews said the VAT cut for tourism in 2011 had a positive impact on the sector and enabled the industry to recover at a far greater pace to become one of the fastest growing job creators at that time.  

But Ms Andrews said any reduction in VAT has to be passed on to the customer.  

She said the Republic of Ireland has one of the highest VAT rates in Europe and a reduction in the tax will aid and stimulate the tourism sector. 

Businesses that are opening now, she said, have been closed for months and need to trade and get people in through their doors. 

She said they are taking huge precautions and altering their business so customers can enjoy experiences safely. 

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Ruth Andrews told Morning Ireland that it is in no one's interest to increase prices. 

She also said that safe ways to reduce or relax the current quarantine measures must be examined. 

Meanwhile, the chief executive of Tourism Northern Ireland welcomed the new temporary VAT rate for the UK tourism sector and said the next six months will be critical for the industry.

John McGrillen said it 'i important that there is still an industry in place when things pick up - hopefully in the Spring. 

He said he does not see tourism in the North and Republic of Ireland as being in competition, but that there should be a collective role to try and get as many people as possible to holiday on the island of Ireland.  

John McGrillen said around 600,000 people from the Republic take short breaks in the North in any given year and he believes that will continue.