THE HOYOS FILE: No reservations required
At the risk of stepping into even more disfavour with the hoteliers in this country and also being seen as giving too much praise to Government, I would just like to congratulate Minister of Finance Chris Sinckler on raising the value added tax on accommodation.
As of May 1, VAT on tourist accommodation will go up by 1 1/2 per cent to 8 3/4 per cent. Why the funny amount? Because the present administration is too afraid of the hoteliers to just do what needs to be done (in my opinion), and that is to put the VAT on visitor rooms at the same percentage it is for every other service or product consumed by tourists, except for those deemed non-VAT for everyone.
Mr Sinckler, don’t be afraid to go the whole hog. It is time the hotel industry made its full contribution to the VAT coffers.
You know, it is funny how we have swallowed the hotels’ mantra of gloom and despair for so long, rather evocatively expressed by my good friend Colin Jordan in another section of the Press, that “You don’t get people patronizing direct tourism services unless they are actually here. So [the increase in VAT] has the potential to be disastrous and I am clear in my mind on that.”
As I have said before, much to the consternation of my pals and cronies (right) in the sector, I would prefer the tourists to pay their 17.5 per cent and then benefit from far more non-VAT food items like the rest of us as long as some way can be found to ensure that suddenly the “import price” of those very same items did not just coincidentally go up by the same amount the moment the tax came off.
Anyway, the hoteliers know full well that any tourist who actually arrives in Barbados understands it is not the cheapest place to visit and would already have been ripped off (if they are British) by their own government’s massive airline head tax.
When they get here, all they have to do is pay the same VAT as the rest of us. I disagree that a full-price VAT on their rooms will be the straw to break the camel’s back.
When I go to New York and stay in a hotel, I have to pay around 20 per cent in federal, state and local taxes, and a ten per cent service charge. On everything. In restaurants you are expected to tip a minimum of 20 per cent.
Of course, at the places I eat, that doesn’t apply (did someone say fast food chain or coffee shop?).
In Britain, VAT is now 20 per cent. But there is apparently no VAT on many consumer purchases, including children’s food and maybe clothing.
We consumers have seen huge increases in our utility bills and the cost of food even before the raising of the VAT by 2.5 per cent late last year, and we can cry all we want about the potential for disaster but we still have to deal with these rises in the cost of living.
And even though Mr Sinckler says the increase in VAT is only temporary, I have no reservations about recommending that the current rate stay where it is until the Government’s income and expenditure are at least within shouting distance of each other. Otherwise, we will only be saddling ourselves with worse budgetary problems than we have now.
Of course, “no reservations” means something entirely different for hoteliers, which is why they have plenty of them about any increase in the tax.
Speaking of tourism, if like me you wouldn’t know what a chukka was unless Sir Charles explained it to you, you have to admire the tremendous role a sport being played by so few people (relative to other sports) is doing for our country’s image as a high-life destination.
Having upset my hotelier friends, I may as well annoy my polo-playing buddies by describing polo as a sport wherein you gallop around on horses hitting some sort of puck until it gets into the goal. If you do this more than the other team for a few chukkas, you win. So it’s like hockey on horseback.
This game, as with almost any equestrian sport, attracts royalty, and along with the blue bloods come the lords and ladies and rich businesspeople. Along with golf, polo helps to create the image of the sophisticated Barbados which we all aspire, and many perspire, to achieve.
So powerful is the image of a man on a horse with a stick raised in the air that it has become iconic in the fashion industry. I love those shirts by you-know-who because they are so comfortable to wear, and they survive the poor treatment I give them.
You can also wear old jeans with them, as the shirt does most of the heavy lifting for you.
The polo image is now being used to sell shirts by the United States Polo Association as well as at least one other garment maker whose name I can’t remember.
So it is indeed a symbol of success and living the high life, and the fact that we in Barbados have a thriving polo-playing community must help us a whole lot more than we may realize in gaining marketshare among the type of visitor who often comes every year to stay in a villa and often ends up buying property as well.
Even if they don’t play polo.