Hotels and resorts allowed to honor prior bookings at 7.5% VAT
Information received from the BHTA explains that there were concerns within the industry about whether the industry would have time to make the necessary changes in the one month given by government before the 12 percent VAT comes into effect, and whether that increase would affect pre-bookings, especially with groups already locked in at a contracted rate.
The Ministry of Finance explained to the hotel sector: “Any material bookings, pre-booked, pre-paid bookings, groups, contracts and agreements for travel, rooms, facilities and package deals made with the resort or with agents of the resort, third party sellers/bookers of travel and accommodation prior to September 30, 2018 for travel through June 30, 2019 will be honored at the 7.5 percent VAT. The resorts will be required to furnish specific summary details of such bookings to the Department of Inland Revenue by October 31st 2018 in a format to be prescribed by the department.
“Groups – any material bookings, pre-booked, pre-paid bookings, contracts and agreements for travel, rooms, facilities and package deals made with the resort or with agents of the resort such as third party sellers/bookers of travel and accommodation, between now and July 31st 2018 for any point in the future (post-June 30th 2019) will be honored at the 7.5 percent VAT. The resort will be required to furnish specific summary details of such bookings to the Department of Inland Revenue by August 31st, 2018 in a format to be prescribed by the department.”
The BHTA explained that it was “pleased to provide input to government and appreciated its considerations with regard to VAT implementation”.
“We requested a reasonable transitional time to ensure that this business was not disrupted, and that agreements and relationships with global and local travel partners were not adversely affected,” the BHTA pointed out.
“We will continue to discuss strategies and proposed solutions, and to collaborate with the public and private sector to achieve collective goals. We welcome the deputy prime minister’s comments made in Parliament today (yesterday). We will work to effectively communicate to our travel partners, members and tourism industry stakeholders to achieve a smooth transition process with little or no disruption to this segment of our business model.”
Involved in the talks with the BHTA and the Ministry of Finance regarding the VAT increase were the Bahamas Out Island Promotion Board, the Bahamas Hotel and Restaurant Employers Association, the Nassau Paradise Island Promotion Board, the Association of Bahamas Marinas, and representatives of small hotels and other private sector representatives, according to the BHTA.
The Nassau Guardian
