By Elesha George
It is unclear whether hotels and other private tourist lodgings had ample time to mull over the impending Tourism Accommodation Levy (TAL) ahead of its announcement.
Prime Minister Gaston Browne said during Thursday’s budget presentation that the new levy – which will be used to fund climate resilience – had already been discussed with “key operators in the tourism industry in Antigua and Barbuda”.
He said, “They recognise that tourism is vulnerable to the impact of climate change and, therefore, it is in their interest to help build climate resilience”.
However, OBSERVER media was furnished with a memo issued by Vernon Jeffers, the Chairman of the Antigua Barbuda Hotel Tourism Association (ABHTA), requesting the input of ABHTA members on what he termed the “introduction of room night tax”. The memo was dated January 20, suggesting that it was sent to workers just three days before it was to be announced by the Prime Minister.
The request asked members to give “immediate feedback” about the pending levy in preparation for a meeting with the PM and Tourism Minister Charles “Max” Fernandez on Wednesday – a day before the budget presentation.
The Chairman, in his correspondence, gave a breakdown of how the tax is expected to be implemented.
It states that room rates less than U$250 per night would incur a charge of US$3 per guest per night, with a maximum of US$10 per room/night for up to four guests, and room rates more than US$250 per night would incur a charge of US$5 per guest per night, with a maximum of US$15 per room/night for up to four guests.
It is slightly different from Browne’s assertion on Thursday that the tax would be charged at a rate of US$3 per guest per night for room rates up to US$150 per night and a rate of US$5 per guest per night for rooms with rates above US$150 per night.
When contacted on Friday for comment, Patrice Simon, ABHTA’s executive director, said she did not wish to make a statement on the tax yet as it is still being discussed internally.
The new charge, according to the PM, will go towards establishing a Climate Resilience and Development Fund (CRDF) to aid the construction of several facilities that will help to “finance resilience and support development”.
The levy will be applicable across the board, affecting hotels, guest houses, apartments, AirBnB rentals, and villas.
The prime minister said the tourism tax was adopted in favour of other taxation methods needed to boost public coffers.
“We have chosen the levy over increased taxation of the workers of this nation, and that decision, we feel sure, is the right one at this time,” he said.
In addition, Browne announced that a portion of the monies collected for the Revenue Recovery Charge (RRC) will go towards the CRDF, warning that there would be no more waivers of the 10 percent tax that the Customs and Excise Division is mandated to collect on imported items.
According to Browne, “Preliminary estimates indicate that the Tourism Accommodation Levy and the roll back of RRC concessions could yield between $50 million and $80 million annually or about 1-2 percent of GDP.”