They represent more then 250 hotels which adds up to about five thousand rooms and today the Belize Hotel Association, and its umbrella group the Belize Tourism industry Association, rejected government's plan to make those rooms exempt from sales tax. "Exempt" may sound like a blessing, but really, it means "exempt" from getting GST refunds, which is like going to the party and not getting to dance. And not surprisingly, the BTIA and the Hotel Association staunchly oppose government's plan to exempt accommodations from the GST. The exempt status for hotel rooms mean the hotels will pay the ten percent GST but they won't be refunded. BTIA's Executive Director Andrew Godoy say it could cripple an already overtaxed industry.
Andrew Godoy, Executive Director - BTIA
"We felt that a zero rating would benefit the industry far greater than exempt status. We've also looked at our investment in tourism, we have over $500 million in investment, and all this is taxable because its fixed investment so it's taxable and we felt that if we have an exempt status, that will drive up the cost for our business and eventually kill the goose that lays the golden egg. We've, in the last two years, had an increase in the hotel accommodation tax which went up from 7% to 9%, as you may know, and we continue to have the industry being taxed. We felt, and said sometime ago, that the industry is being looked at as the cash cow.
On December 22nd the BHA had a meeting with the Prime Minister and they presented their position on the whole GST and said that they felt a zero rating would be best for the industry as opposed to an exempt status and this is before the second and the third reading. After that meeting on the 22nd, they wrote a letter to the Prime Minister on the 23rd reiterating this, and yet we find that the bill, the second and the third reading, was still held on the 28th. So it makes us wonder how much the government really values the accommodation sector and the input that we generate in terms of revenues, foreign exchange, for the government because by giving us the exempt status, it will put us in position where it drives up costs. So at the end of the day we feel they are putting our businesses in jeopardy. If we continue to tax the industry, it will drive up the cost at the end of the day to the consumer and we feel that that definitely will put our businesses in jeopardy."
The BTIA has written and is now requesting an audience with the Prime Minister. Leaders haven't said what they'll do if government doesn't change the tax. Last week the Chamber of Commerce similarly raised objections to the GST Bill.
