Hotel Accommodation Tax to be increased from 7% to 10%
The revenue raised once the tax is adequately collected is expected to be in the vicinity of $28M. The amount currently being collected was said to be $3-4M.
"The other way we can finance all the things we need to do for the people of the territory is taxes. Tax is something that all governments have to do from time to time, and that includes the BVI government," Premier Dr The Hon D. Orlando Smith said in introducing the bill to the House.
The Hotel Accommodation (Taxation)(Amendment) Act, 2016 was passed with amendments following debates from both sides of the isle.
According to Minister for Health and Social Security Hon Ronnie W. Skelton, it is not a tax on the Virgin Islands people as “that is the last thing” Government wants.
One of the concerns is what guarantees Government will have to ensure that the right amount of taxes are being collected and how to address the issue of visitors sleeping on yachts.
Fifth District Representative Hon Deloris Christopher noted that it was time the tax was increased since it has stood at 7% for decades. She also brought up the issue of persons sleeping in yachts, alleging that there is a business in Soper’s Hole that has been allowing their guests to sleep on boats.
To justify their figures, Premier Smith stated that the Hotel Accommodation Taxes for several Caribbean countries were looked at. He said Anguilla has 10 percent, Cayman Islands 13 percent, Guyana 10 percent and Dominican Republic 16 percent.
Hon Skelton stated that he actually wanted the increase to be 12% but he was out-voted in Cabinet.
Taxes not always justified
Junior Minister for Tourism Hon Archibald C. Christian tried to calm concerns about the tax increase. “I fully understand to a certain point why those concerns will always exist. The truth be told, sometimes governments do not really spend the people’s money wisely. Sometimes they cannot justify why they are increasing taxes," he said.
Opposition Leader Hon Julian Fraser (RA) wanted to know how Government was going to realise the taxes on accommodations from a hotel that books its visitors by a foreign agent, the visitors themselves are foreign, the hotel is owned by a foreigner and the tourists deposits their money in an overseas account.
Hon Fraser also wanted Government to say exactly where the revenues raised were going to be channeled.
And First District Representative and Opposition Member Hon Andrew A. Fahie wanted to know the hoteliers were engaged before deciding on the increase. According to him, 10 percent didn’t sound like much but it was very expensive to do business in the territory.
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26 Responses to “Hotel Accommodation Tax to be increased from 7% to 10%”
That said, the govt is claiming that increasing hotel taxes to 10% would recoup some $ 28 million annually. Based on that, then 7% hotel taxes should presently be yielding some $ 21 million, but they are saying they only collect $3-4 million, so my question is where is the missing money? Where is the accountability? Maybe instead of raising hotel taxes, the govt should audit hotels and other accommodation providers to see where the missing monies are. If they do not, how can they expect to collect much more than $ 5 million by raising hotel taxes by 3%, based on the amount currently collected. Or is there something else going on?
I thought this was supposed to be a secret. Isn't that what he said in the HOA the other day?
their fellow county man, others among us have big Swiss Banks Accounts BUT some of us far to busy taking f*ck on radio, tv and in the house of assembly: there was a saying from back in the day "black man will never know himself until he is back again the wall"....give the white investors whatever their harts desire while the nationals of this territory gets the crumbs from Master's Table: we pay all the tax and the whites gets all the privileges....