Bad advice

Hotelier warns higher exit taxes will hurt tourism

Don’t raise airline departure taxes!

That is the stern warning to Government from hotelier Adrian Loveridge in response to a proposal to increase tourism taxes, put forward by the Foreign Exchange Working Group of the Social Partnership, which was mandated by Prime Minister Freundel Stuart to advise Government on measures to boost the dwindling foreign exchange reserves.

On the other hand, Loveridge said he had no difficulty with the recommendation by the same committee to increase the cruise head tax.

Concerned that the bread and butter tourism industry is not producing the required financial returns while the island’s stock of foreign reserves is fast declining, the Committee warned of the need for urgent corrective action to stem the downward trend, including hikes in cruise visitor head taxes and airport departure fees.

Adrian Loveridge

However, Loveridge, the owner of Peach and Quiet, told Barbados TODAY the exit tax of US$30 is high enough as it is, and any increase will hurt, not help, the country.

“Our departure tax is already one of the highest in the region, we already levy VAT [Value Added Tax] on air travel, so we are already an expensive destination to get to and leave from, so that certainly would not be on my list for sure,” he said.

However, he adopted a different position on the cruise tax, which stands at US$6, arguing that “cruise ship companies contribute very little in terms of land-based tourism to the economy”.

Loveridge’s stance was supported in part by one of the largest travel agencies here, Going Places Travel, which went one further by opposing any increase in tourism taxes.

“There is no room for tax increases on cruises or airport departures in Barbados. Travel is already taxed very heavily and we do not need to give tourists a reason to find another destination,” County Manager Alanna Gray told Barbados TODAY.

Meanwhile, Loveridge suggested that if Government wanted to increase the financial returns from tourism, it should consider lowering VAT on direct tourism services. He pointed to the case of Argentina, which recently adopted a similar move, and according to him, within a few months, that country recorded an increase in arrivals figures and overall spend.

“It would encourage more people to come to Barbados through lower taxes which would be offset with a higher net spend and hopefully, a higher average spend of each visitor that comes to our shores,” he said.

In response to the working group’s concerns that the tourism industry is not producing adequate financial returns, Loveridge said Government has only itself to blame.

“We’ve done this to ourselves, you see. We’ve allowed particular players in the field to come in, getting enormous tax concessions – 25 years without any tax . . . . We’ve allowed this to happen,” he said in a clear reference to the 25-year tax holiday given to Sandals International.

The concession includes a waiver on all import duties, taxes, impost and levies on capital goods such as building materials, as well as food, alcohol and beverages, and extends to duties on the importation of motor vehicles and personal and household effects for senior hotel staff and non-Barbadian workers.

When the 25-year tax holiday is ended, the rate on concessions to Sandals will be cut by 50 per cent for an additional 15 years.

“When my wife and I stayed at the Sandals property we asked for a VAT receipt and we were told that Sandals don’t pay any VAT because it’s a tax. And the money that we paid by credit card is collected offshore in Fort Lauderdale and doesn’t necessarily even come back to Barbados. So when you have a government saying the private sector tourism industry is keeping money offshore, they are the people that have made it possible,” Loveridge charged, adding that small hoteliers like himself collect the VAT locally.

He added that he would like to see the local tourism industry operated on a more level playing field, where all partners benefit from some level of concession, which he recommended was best done by reducing the VAT rate on all aspects of the sector.

“So car rentals, restaurants, tourism attractions and activities, people like Atlantis Submarine, and all the remaining accommodation providers pay the same rate of VAT, 7.5 per cent.

“I’d also like to see the enormous influx of unregistered accommodation also brought into the tax threshold. As the protocol director of Airbnb said recently, roughly 16,000 people booked accommodation through Airbnb on Barbados last year. I’d like to see all those accommodations providers paying VAT as well,” Loveridge said.

12 Responses to Bad advice

  1. Jennifer April 25, 2017 at 7:05 am

    “We’ve done this to ourselves, you see. We’ve allowed particular players in the field to come in, getting enormous tax concessions – 25 years without any tax”

    No wonder barbados is said to be a tax haven. Then the money leaving the country to offshore accounts. Mind you the poor black man and woman getting tax through their a$$e$. If our politicians are not COMPLETE sell outs and a bunch of submissive coconuts I do not know what is. All in the name of keeping the plantocracy going with our people being maids, toilet cleaners, nannies in the name of tourism, and smiling sweetly, grateful for the work. Mind you this big turkey feeling for his craw, wanting a level playing field. Welcome to our club. The only playing field we got is the ones knocking around to play with that ball on. Our problem is that who should be in JAIL is out and who is out of jail should be in JAIL. The wrong people in power and the wrong people out of power. Every thing is upside down. I am convinced it is that education given by the same old serpent.

  2. Alex Alleyne April 25, 2017 at 8:51 am

    Remember it’s the peoples’ money and there is a lot more world out there to see. So if Barbados want to shoot itself in the foot then go ahead . Why bite the hand that feed you. We done know sugar dead and you planning to pull the rug from under yourself .

  3. Bobo April 25, 2017 at 1:01 pm

    Since Barbados independence politicians come and go –what were and continued to be –their productive visions — I TAX YOU HERE –I TAX YOU THERE where are the roads, hospital, education, trained teachers evolving with times etc etc –New Airport taxes, will i be getting a cup of tea if my plane is delayed or will i have to pull my money out.

    Quite common among corrupt leaders ”they always bite the hand that fed them”-

    • Jennifer April 25, 2017 at 4:47 pm

      @Bobo – ok. Well said.

  4. nanci April 25, 2017 at 1:21 pm

    Barbados government think all the people who come into the country is loaded with money. They love to tax you where you have no choice. The government will put on a high tax increase, they dont know nothing about 10 or 15 dollars more, they will put on like 50 dollars. Just thieves and mismanaged incompetent leaders, that people wont open their minds, and vote for living a happy life, not to be poor and always looking to just survive. Dont let politicians bring promises or come in the neighborhood and drink and shake hands with the boys. Let them give you long term joy, like good roads, lower food prices, good schools, improve bus service. Demand long term joy that will embrace your kids and grand kids.

  5. nanci April 25, 2017 at 1:26 pm

    the country want tourism but the same time tax the tourist continously.

  6. Neil April 26, 2017 at 5:58 am

    I agree 100% with Mr Loveridge, that the playing field is on a hill, it’s not level and it is very unfair for all of us.

    Why is it the some, not all , Finance Companies rent /lease cars to tourists from three weeks to 5 months on private license numbers paying less on car insurance and licensing than us Registered Hire Car Companies but they still want you to purchase cars from there Parent Car Dealership. They the Finance Company would get a better cost than the Hire Company, they can offer a better rental rate to the tourist than us.
    This is totally wrong and this Government and the Police need to put a STOP TO IT. I can name the Finance Companies that are in the business of short term rentals that they call leases.

    You speak about AIRBNB but what about the employee working in the Insurance field and working in the hotel industry that are renting private vehicles.

    When it comes to Island Tours, we the Tour Companies and the Taxi operators are also being unfaired with private license numbers on vans and cars transporting tourists for tours, to boats, island tours etc. what is next? Fake doctors attending to tourist cutting out the professional Doctors?

    So where is the level playing field here!

  7. Mark Adamson April 26, 2017 at 7:26 am

    In Barbados, the fact is this: that IN SPITE OF this evil, wretched, criminal Taxation system and the very enormous and extensive destructive and ruinous ideological, psychological, social, political and financial consequences of it upon this country, the Barbadian society and all sectors and the most productive of Barbadians that are part of this society still have been able to achieve a fair degree of overall national social progress and development.

    Now, fundamentally because of this said Taxation system, the current RATE AT WHICH this overall national social progress and development has been taking place is slower and slower, and the SCOPE OF this type of progress and development lesser and lesser, in both regards, than when contrasted with 20 – 30 years ago when such growth and development was faster and more than at this juncture.

    At this stage, there is far greater (scale and rate of) stagnation, dedevelopment, decline, decay, collapse and ruin taking place in all the sectors of this country than 20 – 30 years ago.

    Whereas part of the enormous and extensive destruction and
    ruination that has been brought on by this evil, wretched, criminal
    Taxation system is of a financial nature/dimension, the greatest
    destruction and ruination that has been brought on by this said
    irrational unproductive Taxation system is of a psycho-political

    Indeed, the government of Barbados causes/helps cause this
    enormous and extensive destruction and ruination in the psycho-political realms, thus leading to greater (scale and rate of)
    stagnation, dedevelopment, decline, and decay in the social
    realms, by its substantially stopping, preventing, restricting – via
    TAXATION – hordes of individuals and groups of individuals from
    continuing to engage in or engaging in or planning or proceeding
    to engage in MORE/social commercial activities that lead to the bringing about of MORE/receipts for the persons involved in the commercial physical activities from some others, unless there is – to whatever degrees – compliance conformity with these measly TAXATION authorities’ commands, instructions and directions – and which come with political sanctions for non-compliance/non-
    conformity with them.

    It is this set of commands, instructions and directions that intervene and constitute these stopping, preventing, restricting
    psychologies, symbologies, politics, that are sensed for the minds of thousands upon thousands of people in Barbados to see and
    internalize, whenever they FEAR and or FACE the prospects or
    possibilities or actualities of dealing with this satanic Taxation
    system in Barbados, and, too, that are regrettably acted upon in the vast majority of cases by whom so ever they are issued to and with political sanctions for failure to comply with them ( threats of prosecution, more threats of confiscation of properties, from these TAX mongerers / an instance, the former so-called solid waste tax matter).

    These evil wretched stopping, preventing, restricting psychologies, symbologies, politics actually do help stop, prevent,
    restrict, mounds and mounds of what was happening before and
    what was planned to come about, from actually happening, therefore less overall national commercial industrial activities, n the context of the social, political, material and financial realms of the functioning and developing of the personal, sectoral and national societal affairs of this country.

    That is partly how this murderous Taxation system – that has the useless uncritical support of Dr. Frank Alleyne, Dr. Clyde Mascoll,
    Dr. Brian Francis, Mr Ryan Straughn – functions.

    Copied from a previous Facebook submission by Mark Adamson (but edited for greater clarity and style of presentation).

  8. Andrew Simpson April 26, 2017 at 8:42 am

    No one likes to be targeted nor left out, depending on the effect of such action on their being. Fairness must be practiced as an underlying economic ideology. Governance must become focused on what is best for the Nation as a whole. Evonomics and Environomics are being talked about. We cannot rely on any one interest group to set the course. The people must develop a modern platform from which to speak, in an authoratitive but balanced consensus, that can be relied upon to formulate National policy and initiate mechanisms for enterprise to evolve.
    Righteous behavior must be encouraged while unhealthy practices penalized. Reduce taxes but increase fines.

  9. Frank White April 26, 2017 at 10:05 am

    @ Jennifer, very well said…

  10. Milli Watt April 26, 2017 at 8:26 pm

    @ Jennifer don’t forget the stinking unions complicit in keeping wages constrained in an industry that carrying this island yet the line crew people got to scrunt……… solution another tax. the hotelier that complaining seemingly was not invited leaves me to conclude not all of them play golf together but what do i know i only play the FOOL

  11. BimJim April 27, 2017 at 9:25 am

    I physically shudder to even think about it, but perhaps Barbados needs to be razed to the ground – devaluation, poverty, complete bankruptcy of government, public and private sectors – for those most ignorant and greedy of political yard fowls to be forced to recognise that their blind (or paid) support of incompetent and/or corrupt and/or stupid politics and politicians only contributes to making the leadership and economic problems worse.

    The “Labour” Parties which were formed so long ago to protect and encourage the working man (and woman) have not done so for many decades. In fact, it muight be argued that the day The Dipper took his hand off the tiller was the start of the demise. Today, all they seem to care about is themselves and how much they can squirrel away for their own presents and futures.

    Barbados has not seen a true statesman or REAL leadership since Tom Adams – and I am NOT raising up the BLP, they are almost worse than the DLP these days.

    My proposal is to kick the current herd of silent and braying jackasses – on BOTH sides of the aisle – into the Careenage and start afresh. It is clear to me – I am sure some would argue against – that ANY new Party with truth in their mouths and their country in their hearts could take on what has become this giant garbage dump of an economy, turn it around, and out of it produce some new, REAL statesmen for our times.

    Because unless new faces are given a chance to show what they can do, that huge pool of potential talent – like the many, many braying jackasses we now are forced to live with – will just be more Billions of wasted dollars, decades of wasted opportunity, and lives down the drain.

    There comes a time when the old faces and old ways are no longer worth holding onto. I say that time is NOW, I say open your ears and heart to new faces, new people and new ways. It is CLEAR that the “system” we have now has lost every vestige of competence.

    It is time to move on, neither BLP and DLP are able to cut it any more.


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