Caribbean hotel and tourism studies

This week the Caribbean Hotel Association released its study on the impacts of taxes on the hotel and tourism sectors of the region's economy --


Caribbean hotel sector overtaxed in detriment of revenues for the wider economy

"Activities in the Caribbean tourism industry are unduly subjected to additional taxes not found in other sectors, such as room tax, import tax, and departure tax. This is according to the study entitled “Taxation and Tourism Costs for the Caribbean Hotel Sector,” undertaken under the Caribbean Regional Sustainable Tourism Development Programme (CRSTDP) by PA Consulting Group, as part of technical assistance provided to the Caribbean Hotel Association with funding from the 8th European Development Fund (EDF). The study looked at the competitiveness of hotels in the Caribbean, in relation to their operating costs, taxation levels, and other non-cost barriers that negatively impact the tourism sector - focusing on four sample destinations: Barbados, Dominican Republic, Jamaica, and St. Lucia. The findings were released on Friday at the Caribbean Small Hotels Retreat held last week in Barbados.

The resulting report shows that most CARIFORUM countries have fiscal incentives for the establishment of hotels, which include exemption of corporate taxes, reduction or exemption from import duties on equipment, and reduction or exemption of duties on construction materials. However, the reduction in duties applies specifically to the construction phase and incentives often run between 5 to 15 years depending on the number of rooms the hotel is constructing. “On one hand, governments traditionally address the burden of high expenditures by applying taxation to leading sectors in the economy-more often than not, the tourism sector,” said CHA President Mr. Peter Odle. “By the same token, such an unfriendly fiscal climate makes our destinations less attractive as an investment opportunity and less attractive to visitors, which produces the exact opposite of the intended result of taxation in the first place. It begs the question: ‘Do these incentives, as they are, achieve their goals?’ " ...

for the complete press release see:
http://www.caribbeanhotelassociation.com/News.html

ERA has the report as well as its sister report The Caribbean: The Impact of Travel and Tourism on Jobs and the Economy