|
|
News
|
|
|
|
Opinion
|
|
|
|
SKN
Observer
|
|
|
|
Advertising
|
|
|
|
Resources
|
|
|
 |
| Tourism Official
Worried About VAT's Effect |
| By Sheena Brooks |
|
|
 |
|
Michael
Head
|
| |
A head Tourism official
has expressed concern that too high a Value Added Tax
(VAT) rate could spell disaster for the local hotel
industry.
Michael Head, Manager of the St. Kitts and Nevis Hotel
and Tourism Association told The Observer that
he is hoping VAT will not be levied on hotels at more
than the 9% government tax currently being applied.
He said an increase to hotel taxes could adversely affect
already cash-strapped hotels.
"We have been in consultation with the tax reform
team on the matter of VAT and we've made a plea that
the rate as it applies to hotels, not be more than 9%.
We believe that anything higher will be a disaster to
the industry as hotels would have to raise their accommodation
and restaurant rates," Head said.
Currently, hotels across the Federation charge a 19%
tax on services- 9% government tax and 10% service charge.
Prime Minister Hon. Dr. Denzil Douglas informed the
nation on March 23 that VAT would be implemented on
November 1 and would be replacing at least 10 existing
taxes. The list of taxes to be substituted includes
Hotel and Restaurant Tax and Consumption Tax.
Head explained that if Consumption Tax was removed there
would be no need for hotel restaurants to increase their
prices. Increased restaurant prices would affect both
stay-over and cruise visitors to the island. Revenue
earned from stay-over visitors account for the bulk
of overall tourist revenue, as they spend money on accommodation,
food, vehicle rentals, sight-seeing and tours, and shopping
over an extended period of time as opposed to cruise
visitors spending a few hours on the island.
The HTA manager said he is hopeful that the issue of
the VAT rate for hotels will again be discussed at a
meeting with the officials scheduled for next Thursday.
Minister of Tourism Hon. Richard Skerritt spoke to the
issue of stay-over visitor decline during his presentation
at last week's Budget Debate saying the 9% decline experienced
in St. Kitts-Nevis was not as bad as that experienced
by other Caribbean destinations.
"In 2009 stop-over visitor arrivals were down in
our Federation and across the Caribbean several hotels
were forced to lay off employees and a few closed their
doors as a result of decreased revenue from low occupancy
and reduced visitor spending rates. However as the year
came to a close St. Kitts feared comparatively better
than most, showing year to year stop over visitor arrival
declines of approximately 9% versus mostly higher drops
experienced by many other Caribbean neighbors,"
he said.
He also pointed out the importance of tourism to the
country's overall economic output. "The Tourism
industry already directly contributes approximately
8.6 percent of the Gross Domestic Product, directly
providing approximately 32.3% of the total employment
with an estimated 7000 or 1 in every 3 jobs. This number
is predicted to rise to 9.9% of the total GDP by 2019
according to the World Travel and Tourism Council figures."
|
| |
|
|
| |
|
|
