Friday 30 October, 2020

Tobago Hotel and Tourism Assoc offer suggestions to boost sector

The members of the Tobago Hotel and Tourism Association (THTA) were surprised by the relatively few stimulus initiatives for tourism in the recent budget presentation.

In a release stating their thoughts on the budget, the organisation said their surprise was a result of Prime Minister Dr Keith Rowley’s recent announcement that Tourism and Agriculture would be at the forefront of the economy’s diversification from gas and oil.

The THTA said while they welcome the continuation of the Tourism Accommodation Upgrade Project until September 2023, additional assistance for the Tourism sector and the Tobago economy in general could have been given such as an expansion of the Government Loan Guarantee Programme, which they say have been in place since 2012 but has so far only been offered to properties with between six to 50 rooms and the take up has been low.

"One of the reasons for this is that smaller properties are unable to meet the strict lending criteria. The loan facility should be extended to include properties with more than 51 rooms and businesses within the allied tourism sector," the THTA said. 

The group  recommended that qualifying businesses should be given the opportunity to consolidate existing loans for 15 years at a low interest rate, thereby ensuring business continuity.

They also suggested that Value Added Tax (VAT) exemptions should be granted for Tobago registered businesses for five years which will have the double impact of stimulating economic activity and giving business owners much needed time to recover from the effects of the pandemic.

Among the THTA recommendations is that Tobago should be made a Duty Free Zone to stimulate economic activity and encourage local, regional, and foreign patronage.

"It will enable Tobago businesses to offer competitively priced goods and services, such as all-inclusive accommodation, and attract visitors to the island," the THTA said. 

The group also believes that additional funds  be made available to Tobago’s accommodation providers through the Tourism Accommodation Relief Grant.

The THTA said to date 53 properties, mostly small guesthouses and villas, out of a potential 422 listed by the Tourism Tobago Agency Limited, have applied and six properties have received 50 percent of the grant funds so far.

"The THTA anticipated that the take up on this initiative would be very low given the difficulty small business owners have in meeting the grant criteria. We also predicted that the actual amount of money spent from the $50 million would be minimal. Serious questions must be raised as to what happens to the balance of the $50 million," they said, suggesting that the balance of the money should be made available to qualified applicants to pay off debts accrued during the period in which businesses were closed.

"This will not be an additional drain on the treasury and will enable business owners to pay their staff and resume operations when advised by the Government. This will also ensure that Government funds are being used for the purpose for which they are intended."

The THTA would also like to see the implementation of Covid 19 tax relief applied to businesses that spend money on  infrastucture and other things during the pandemic. 

They said the all those expenses should be tax deductible at 150 percent and should apply to businesses in Trinidad and Tobago.

The THTA said instead of paying hotel tax directly into the Consolidated Fund, the Government should create a separate Marketing Fund for part or all of the hotel tax revenue collected in Trinidad and Tobago.

They said this is the norm in most tourism destinations and the funds generated will be supplemental to Government allocations to TTAL and Tourism Trinidad Limited (TTL).

Other recommendations include the abolishment of the Land Licence Order of February 2007 and free incentives to  encourage Foreign Direct Investment in Tobago and boost the economy.

 

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