Published Thursday, 26 April 2012
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Tens of thousands of people stay in Northern Ireland every summer and the popularity of mobile home holidays is continuing to grow, with the sector now worth £80m.
However, in the last budget, the government suddenly introduced a VAT hike on caravan sales which will see the average price rise by up to £5,000.
Park owners and caravan distributors warn a valuable industry will be damaged.
"A 20% hike will increase in the price of an average caravan will put the price up by £5,000 pounds," said James Kennedy from the British Holiday Homes and Parks Association.
"Is that affordable for our users in the current economic climate? I would suggest not.
"That will mean a reduction in caravan sales from a park operator and we would estimate a reduction in sales of between 50% and 65% to 70%."
A mile from Bushmills in Co Antrim is Ballyness Caravan Park, the only five star one in NI.
It is a family run business, built up over 12 years, but owner Olive Dunlop said they fear for the future if sales figures drop.
"Caravan sale are a huge part of any caravan park business and we plough the profits back into improving it and making it a more attractive place so our customers will want to continue to come and come in the future," Olive said.
"If we don't have sales it will affect the profitability and standard of caravan parks and may make it an unsustainable business."
Caravan parks provide a huge boost to local economies as holiday makers spend their money in local business - Bushmills for example has three parks and has come to depend on the trade.
Operators across the UK have taken the fight to the government in the wake of the VAT move.
Terry O'Neill from the National Caravan Council said: "Caravans are made in the UK and are distributed in the UK and they encourage people who reside in the UK to holiday at home.
"That's what the government wants and that's what the people want. We provide first class accommodation in these holiday homes and they are very popular, introducing a 20% VAT increase overnight will make them unaffordable to people who would love to take up this lifestyle."
The VAT hike will not be introduced until October, but the belief is widespread within the industry that they will be left in ruins if it is not stopped.