The Barbados Hotel and Tourism Association (BHTA) has declared its willingness to stand with the new Labour Party Government in an effort to breathe new life into a broken Barbados economy.
But the association, led by a former tourism cabinet officer in a previous BLP administration, has said it would not stop engaging Government at various levels in an effort to iron out a number of lingering concerns for hoteliers including some recent tax measures.
Addressing the BHTA’s third quarterly general meeting at the Hilton Resort on Wednesday, Chief Executive Officer Rudy Grant said following the June 11 mini budget, which included a range of taxes on the sector, there have been a number of concerns from members.
“We did write a letter to the Ministry of Finance and we subsequently had a meeting with the Director of Finance and Economic Affairs with respect to that,” said Grant, who pointed out that since then, a tourism working group had been established and discussions have started.
“There is no doubt that the next few years will prove to be very challenging, but it is our expectation that the challenges will also bring new opportunities. For sure we have started to feel the winds of change,” said Grant, a former parliamentary secretary in the tourism ministry in the Owen Arthur administration, of the Government’s tax and restructuring exercise.
Making specific reference to the staff-level agreement for extended fund facility with the International Monetary Fund (IMF), Grant said “we must stay awake, remain vigilant and face the challenge of change”.
The hoteliers’ key worry on taxes was the new Airport Service Charge of US$70 for international travel and US$35 for travel within the region, he said.
Grant said hoteliers were also eagerly looking forward to the day when the new room levies would be discontinued in favour of a change in the level of Value Added Tax (VAT) on accommodation.
Industry officials were still holding out hope they would receive a lower VAT rate than the 15 per cent that was announced in the budget to take effect January 2020, or that the increase from the current 7.5 per cent would be delayed, he added.
“I have to say to you that we are still having some discussions with the Ministry of Finance particularly with the Director of Finance and Economic Affairs with respect to this measure. While it is still a policy of Government we hope to engage in further discussions to determine whether or not there will be some change in this regard,” said Grant.
In relation to the new Garbage and Sewage Contribution (SGC), which will be levied at 50 per cent of an establishment’s water bill, Grant said a letter was sent to the Ministry of Finance for further discussion and he was given the assurance it would be monitored and reviewed.
“Many of our members also utilize private services and the objective, while it is on the part of Government to raise this revenue to facilitate the provision for garbage disposal and sewage, our members are at a disadvantage with respect to the contribution that they make privately in facilitating this. So we are continuing to have discussion as it relates to this,” added Grant.
Despite those concerns, Grant reminded industry players that while price competitiveness was important, they should also seek to ramp up their competitiveness in other areas.
“There are also factors that will be able to impact competitiveness as it relates to the product offering that we have, as it relates to the type of customer service we provide – the type of visitor experiences which our guests have,” he said.
With the busy tourist winter season just weeks away, the BHTA boss said members were also uneasy about what they considered the slow processing of passengers at the Grantley Adams International Airport.
He said they were also anxious about the sargassum seaweed that has floated along the south and southeast coasts and how it was being removed.
“We think that this is really a matter which requires some policy guidance,” he said. “We have to make sure that we are properly prepared for next year and we are able to deal with this particular issue.”
Grant said the BHTA has also been engaging the Royal Barbados Police Force, in light of hoteliers’ reports suggesting a slight increase in beach harassment incidents.
The BHTA would also continue to agitate for the VAT and land tax rebate, the chief executive said, adding that that given the state of the economy they would consider “balancing off what is owed to a member and what the member owes [Government]”.
BHTA Chairman Stephen Austin warned that Barbados had reached a point in its history where “we all have to work harder at what we do for the love of Barbados really”.
Though indicating that the recently announced tax measures remained one of the greatest concerns for members, Austin said he believed that Barbados was doing the right thing and Prime Minister Mottley was taking a very hands-on approach.
“So I am confident that this head-on approach and rallying call to save Barbados has been understood by most of our partners as they too love Barbados and want Barbados to change for the better,” said Austin.
Congratulating Government on reaching a tentative agreement on balance of payments assistance with the IMF, Austin said “it will take all Barbadians to sacrifice and raise their hands to the call of saying ‘yes, we are prepared to assist in securing a successful future for Barbados’”.
“The BHTA stands with the people of Barbados and Government in also saying ‘yes, we are prepared to do all possible to ensure that Barbados returns to the pinnacle of success socially and economically. We can only do this by remaining competitive and enhancing our international image as the leading tourism destination in the world,” he added.