Hotel Association Optimistic Despite VAT

Wednesday, 07 January 2015 00:00 News Editor
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The Bahamas Hotel and Tourism Association (BHTA) yesterday expressed optimism for the local hotel industry in the first quarter of 2015, expecting the industry to outperform the same period last year despite the transition to value-added tax (VAT).

In a press release issued yesterday, BHTA President Stuart Bowe argued that while The Bahamas was unable to directly compete with the low costs of some destinations, including Cuba, “growing optimism” from consumers boded well for the country’s tourism product in the first quarter of the year.

The average room occupancy for Nassau/Paradise Island is 68.4 percent for the first quarter of 2014.

“Growing optimism by U.S. consumers and aggressive marketing by the industry are primary drivers for the positive forecasts. The forecasted occupancy and average rate numbers present us with the opportunity to re-commit to the slogan ‘It’s Better In The Bahamas’ by providing our guests with exemplary service one experience at a time,” said Bowe.

“Our future is tied directly to the quality of the experiences provided to our guests as the best form of promotion: word of mouth. While we cannot match the low price points of places like the Dominican Republic and Cuba, we must aim to provide the highest levels of value.”

Although the BHTA noted that hotels in New Providence and Grand Bahama boasted a solid Q1 forecast with small increases in anticipated occupancy levels and average daily rates (ADR), it noted that the projections varied for the Family Islands due to persistent airlift concerns. Several Family Islands, including Long Island and the Exumas, have cited inadequate airlift as the largest hurdle facing their tourism product.

“Family island forecasts varied, depending on factors such as airlift, where forecasts were impacted by access to the destination.

However where airlift was not an issue, general forecasts were moderate for family island properties, with some properties reporting bolstered group business, which helped buoy their occupancy figures for the first quarter,” stated the report.

VAT transition

The BHTA noted that the majority of the country’s hotels and similar institutions were adequately prepared for VAT due in large part to the training workshops made available through the Ministry of Finance, the Ministry of Tourism, and the BHTA. Most Bahamian hotels will be required to file for the tax on either a quarterly or semiannual basis.

Despite some administrative challenges, Bowe felt that most businesses in the industry were reasonably well prepared, adding that nearly 500 industry stakeholders had participated in 12 VAT tourism-focused readiness workshops conducted in late 2014.

While the sector experienced some challenges, with point-of-sale systems when the tax was introduced on January 1, 2015, the BHTA stated: “Overall, the visitor reaction to the implementation was uneventful for the sector. While there are still issues to resolve, no major issues have been reported from a customer satisfaction standpoint.”

The Nassau Guardian
Published: January 7, 2015

 

Last Updated on Tuesday, 27 January 2015 09:14