The island’s entertainment industry has survived a mix of successes and difficulties in 2022 but promoters say the sector desperately needs a Value Added Tax (VAT) ease in the New Year.
Executive Producer of Nouvelle Vie Inc and CEO of TicketPal veteran events promoter Orlando Newton said the industry’s difficulties started with an absence of activity for two years but continued to be plagued by a lack of flights into the island and for some small producers, the burdensome VAT.
“Right now we are in a recovery stage and that recovery stage is going to take longer than most people think it will take. But with the assistance of the government we were able to overcome a lot of the hurdles,” he explained.
Speaking to Barbados TODAY on the current state of the industry, Newton, the producer of the popular Crop Over event RISE Barbados, said a hike in costs for promoters also provided some hardship.
He cited the steep rise for travel as one area of major concern. Newton, who also manages Halo Night Club noted that since the catastrophic collapse of LIAT in 2020, there has been a huge reduction in regional flight options, which inevitably led to the increase in funds needed to bring artists in for events.
“Before, an artiste from Trinidad could come in on Friday and leave on Sunday. Now, he has to come in on Friday and leave on Tuesday. That happens also for Jamaican artists… before we had a flight coming in from Jamaica at least four to five times per week. At present, there are basically only two flights coming in per week.
‘“So the amount of stayover has increased the production costs of putting on a proper event in Barbados, which is a disadvantage to us as other regional entities have become more involved in the entertainment industry.”
Though the increased costs in several areas connected to the entertainment industry have been linked to the COVID-19 impact on the region’s economies, the effect of VAT has been identified as a historical challenge that limits promoters, especially those producing smaller events.
“We still believe that during the festival season, they should funnel VAT relief to the promoters to allow us to produce a better product. Or, as in most countries, we should get some reprieve on the VAT for at least a year or two to allow the industry to re-develop at the same time,” said Newton.
When contacted Ryan Walters, who staged ICE summer event and the recently-held ICE Christmas event, said that Barbados Revenue Authority (BRA) should seriously relook its current structure of governing events held locally, since it has disproportionately affected small-scale events.
“It is very important to acknowledge the contribution of the entertainment industry. Looking in from the outside it may seem like “fun and games” when people see the finished product. However, this industry is the backbone for many small businesses as their main source of income and should be taken seriously, he told Barbados TODAY.
Ryan Walters
Walters said his wish was a review of the current VAT requirement by BRA.
“One wish going into 2023 is that the Barbados Revenue Authority considers the current practice of charging promoters value added tax on each event even though the revenue collected falls below the annual threshold for VAT registration which stands at $200,000.”
He added: “Not only is it a big hindrance to the financial success of the event, but it is grossly unfair since from my information, this is the only sector that is singled out for the revenue collection agency to dip into the receipts of small business owners who are making, in most cases, less than $200,000 a year because most promoters do one or two events annually.”
The VAT plea was also made by promoter, the group which staged an event on Boxing Day.
He said that while his events this year were well attended, the VAT continued to hamper operations in a big way.
“VAT is a big issue especially from the standpoint of the suppliers. A lot of the suppliers are small [businesses] who do not pay VAT… I find it unfair because VAT only targets the bigger events, and they don’t necessarily go after the suppliers who are not VAT-registered, who do not pay a single cent of VAT, and then we are the ones who are being put in the chokehold.
“I think we really need BRA (Barbados Revenue Authority) to go back to the drawing board and see how we can all work together to help ease one another,” Drakes said.
Reliable sources told Barbados TODAY that promoters have repeatedly voiced concerns about VAT and other challenges with BRA during stakeholder meetings. \
