Barbados is being urged to embrace homestay programmes instead of viewing them as rivals of the hotel sector.
The advice comes from Chief Executive Officer of the Grenada Tourism Authority (GTA) Patricia Maher, who revealed that her country was well on the way to regularizing this informal sector.
Barbadian hoteliers have bitterly complained that homestay programmes have an unfair advantage, as they operate under the radar of taxation, enabling them to offer much cheaper rates than registered hotels. In addition, it is widely charged that informal accommodation have the potential to do reputational damage to Barbados’ tourism product, due to the lack of standards.
However, in an interview with Barbados TODAY on the sidelines of Caribbean Tourism Organisation’s (CTO) State of the Tourism Industry Conference (SOTIC) which opened this morning at the Grenada Radisson Hotel, Maher explained that her country’s hotel sector operated hand in hand with players such as Airbnb, allowing for their seamless incorporation into the sector.
“The government of Grenada has signed a memorandum of understanding with Airbnb to form a working group between the two authorities, which also extends to the Grenada Tourism Authority.
“This ensures that we level the playing field between the hotels and Airbnb to ensure that they pay taxes equivalent to what the hotels are paying in VAT [Value Added Tax]. So that would be my recommendation,” Maher said.
According to the GTA head: “In terms of regulating the accommodation we have insisted in the MOU with Airbnb that the property is first certified by the Grenada Tourism Authority, so that any problems can be dealt with because they first need to be certified and licensed.
“It is a serious partnership and we want to make sure that everyone is accommodated because we know that there is target group that wants to stay with Airbnb.”
Maher’s perspective was supported by the Director General of the Bahamas Ministry of Tourism, Joy Jibrilu, who in her presentation at the media briefing, warned that governments could no longer afford to bury their heads in the sand about the sector while revealing that her ministry had also signed a MOU with Airbnb.
“We are in talks with them. We want to regulate the industry and we are looking at all of our other non-traditional sectors to regulate them as well. We want to know who they are and that their accommodation is suitable so that we can make it a more inclusive industry rather than burying our heads in the sand that the sector does not exist,” said Jibrilu.
Barbados recorded an 8.1 per cent increase in long-stay visitor arrivals during the first half of this year, compared to the same period in 2016.
Last month Chief Executive Officer of the Barbados Hotel and Tourism Association (BHTA) Rudy Grant pointed out that this was not reflected in the occupancy levels of BHTA member properties, which reported a mere 1.5 per cent increase in occupancy for the January to June period.
With every indication that visitors to the island were now opting to stay elsewhere, Grant called on BHTA members to step up their game.
“If, of course, the overall arrivals are increasing by 8.1 per cent and our member properties are reporting they are seeing an increase of 1.5 per cent, all of the increase in visitors of course is not going to our member properties.
“We therefore have to be very aware and conscious of the new realities and we have to ensure that we are able to design those benefits and provide added value for our visitors so that we are able to encourage more persons coming to Barbados to visit our member properties,” he told the BHTA’s third quarterly general meeting at Hilton Barbados Hotel.
Last March, Minister of Tourism Richard Sealy warned against any rush to tax this sector, stressing that too little was known about the operation platform.
“I know the Ministry of Finance is keen to get tax revenue. But before you can tax something you have to find out what it is. It is not simply the case of just saying, ‘all these people are using the Internet to provide accommodation and it is happening outside of the tax net’. Some of these people are normal hotels that are just using it to get business. So we have to do some analysis and go from there,” Sealy insisted then. email@example.com