Minister of Finance Chris Sinckler today announced that effective October 1 the new VAT rate on accommodation in the hotel sector would be 7.5 per cent. He said this was continuing on the path of reducing overhead costs in the sector and putting it on a more competitive footing.
Speaking during his presentation of the 2013-1014 Budget in the House of Assembly, Sinckler said in addition to the new VAT rate on accommodation, that from the start of next month direct tourism services would be brought in line with the accommodation counterparts at 7.5 per cent. This is down from 17.5 per cent. Sinckler said the initiative would cost the Treasury about $9 million annually.
The minister also addressed a request from hoteliers to have certain of their inputs removed from WTO bound rates.
“There has been a longstanding request from hoteliers for a slate of items, including some agricultural products imported under WTO bound rates to be removed from such or have them significantly reduced. My ministry, working in concert with other relevant ministries, is still conducting investigations into the potential impact such requests will have on local producers and indeed the jobs which they generate.
“This evening I give the sector the assurance that in the next six months my ministry will have word on which items we propose to address and which will remain protected.