An­drea Perez-Sobers

Se­nior Re­porter

an­drea.perez-sobers@guardian.co.tt

Re­port­ing from St John’s An­tigua

The Caribbean Ho­tel and Tourism As­so­ci­a­tion (CHTA) is mount­ing a re­gion­al fight against new com­mis­sion prac­tices pro­posed by Book­ing.com, warn­ing that the pol­i­cy could cost Caribbean ho­tels mil­lions of US dol­lars an­nu­al­ly and in­crease pres­sure on an al­ready high-cost tourism sec­tor.

Speak­ing dur­ing a news con­fer­ence on Thurs­day at Caribbean Trav­el Mar­ket­place in An­tigua, CHTA pres­i­dent Sanovnik Destang said tourism stake­hold­ers across the re­gion were unit­ed against the move, which would see com­mis­sions charged on gov­ern­ment tax­es and fees col­lect­ed by ho­tels.

“We are ad­vo­cat­ing that all sec­tors of the ac­com­mo­da­tion in­dus­try should be un­der the same tax rate. If the tax rate on ho­tels in a des­ti­na­tion is 10 per cent, it should be the same for Airbnb. Every­one should make a fair con­tri­bu­tion,” Destang said.

The is­sue sur­faced dur­ing dis­cus­sions in­volv­ing tourism min­is­ters, ho­tel ex­ec­u­tives and re­gion­al stake­hold­ers at the Caribbean Trav­el Fo­rum on Tues­day.

Destang told Guardian Me­dia yes­ter­day that the in­dus­try be­came aware­of the pro­posed change af­ter ho­tel as­so­ci­a­tions in Bar­ba­dos and

Grena­da re­ceived cor­re­spon­dence from Book­ing.com.

“Typ­i­cal­ly, you charge a com­mis­sion on the ho­tel room rate. If there are ad­di­tion­al tax­es or ad­di­tion­al fees, those are not in­clud­ed,” he­said.

He ex­plained that un­der the pro­posed struc­ture, com­mis­sions would now be ap­plied to the full amount paid by guests, in­clud­ing gov­ern­ment

tax­es.

“If you have a rate of US$100 and the gov­ern­ment tax is 10 per cent, that would make it US$110 to­tal. The com­mis­sion would now be charged

on the en­tire US$110, in­clud­ing the gov­ern­ment tax, which you still have to re­mit as a ho­tel,” Destang said.

“You’re not get­ting any cred­it for that. You’re not get­ting any de­duc­tion for that. Ba­si­cal­ly, the ho­tel is just go­ing to have to eat that ad­di­tion­al com­mis­sion on rev­enue that is not theirs.”

Destang not­ed no ma­jor tour op­er­a­tor was known to charge com­mis­sions on VAT or gov­ern­ment tax­es.

He warned that the pol­i­cy would un­fair­ly ben­e­fit on­line book­ing plat­forms when­ev­er gov­ern­ments in­creased tax­es.

“Imag­ine a sit­u­a­tion where a gov­ern­ment in­creas­es its VAT rate from 10 per cent to 20 per cent. Book­ing.com will get more com­mis­sion on that for some­thing that we have no con­trol over,” Destang lament­ed.

He added that tourism min­is­ters at­tend­ing Mar­ket­place had al­so voiced op­po­si­tion and were con­sid­er­ing leg­isla­tive re­spons­es.

“They are go­ing to be writ­ing to Book­ing.com to ex­press their ve­he­ment op­po­si­tion to this pol­i­cy. They are al­so go­ing to be pass­ing

leg­is­la­tion in each coun­try to en­sure that it is il­le­gal,” he out­lined.

Regi­nald MacLean, pres­i­dent of the To­ba­go Ho­tel and Tourism As­so­ci­a­tion and gen­er­al man­ag­er of Blue Wa­ters Inn, said T&T op­er­a­tors were now re­view­ing the po­ten­tial im­pli­ca­tions for ho­tel ac­com­mo­da­tion tax and ser­vice charge col­lec­tions.

“Both the ho­tel ac­com­mo­da­tion tax and the ser­vice charge are tax­able for T&T. So what has to hap­pen here is there has to be a ma­jor push­back to Book­ing.com to en­sure that this doesn’t hap­pen be­cause it will be un­fair to every­one con­cerned,” MacLean said.

He in­di­cat­ed ho­tels were al­so con­cerned about the pos­si­bil­i­ty of dou­ble tax­a­tion.

“If I am paid part of the 10 per cent ser­vice charge as an em­ploy­ee of the ho­tel, I know that once that reach­es my payslip and I cross the thresh­old, I have to pay in­come tax on that,” MacLean stressed.

“We have to en­sure that when Book­ing.com takes their com­mis­sion, that com­mis­sion is less than the amount of the room tax, the ho­tel

ac­com­mo­da­tion tax, and al­so less than the 10 per cent ser­vice charge.”

Ian Good­ing-Edghill, Bar­ba­dos’ Min­is­ter of Tourism and In­ter­na­tion­al Trans­port, said the is­sue was now un­der re­view by his gov­ern­ment.

“We have to en­sure that there is a bal­ance be­tween the com­mis­sions that are charged and what ho­tels can tol­er­ate with re­spect to their

busi­ness mod­els,” Good­ing-Edghill said.

“We have a valid tax regime in Bar­ba­dos gov­erned by law that we are ex­am­in­ing to en­sure that what­ev­er is out there con­forms to what is law­ful and what is al­lowed in Bar­ba­dos,” the min­is­ter added.