THAG disappointed over budget allocations for tourism sector

Apr 06, 2014 News

President of the Tourism and Hospitality Association of Guyana (THAG) is disappointed that the country’s budget for 2014 did not cater for tax waivers for the tourism industry.
Kit Nascimento made this remark on Friday night at the President’s Awards Ceremony held at Duke Lodge.

THAG’s President,
Kit Nascimento

He explained that prior to the introduction of the Budget 2014, the private sector was granted an almost three hour long consultation with the Minister of Finance, Ashni Singh and his team.
“THAG made sure that the Minister was provided with the report and we urged its recommendations. We are disappointed therefore, that none of it is reflected in this year’s budget,” Nascimento said.
“But are we competitive in our pricing and in the means and the cost of travelling to our destinations once visitors arrive in Guyana? No we are not!” the THAG President declared.
In strengthening his view that Guyana’s tourism sector should benefit from tax waivers, Nascimento referred to and quoted parts of ‘An Investment Guide for Guyana’s Tourism,’ by Cecil Miller.
According to Nascimento, Miller, in his piece, points out that tourism is one of the most competitive businesses.
“Miller goes on to emphasize, and I thoroughly agree with him, that we must legislate to make the tourism and hospitality product much more competitive in our region, by benefiting from a lower rate of VAT (Value Added Tax) than the standard rate.”
The THAG President mentioned that apart from the Rupununi, where VAT is waived for the sector, all of Guyana’s tourism destinations and hotels require the payment of the standard VAT rate.
Nascimento compared however that in contrast, several other major Caribbean destinations and hotels benefit from substantially reduced VAT rates.
“Other destinations in our region are granted similar preferred VAT treatment…we sell much of our tourism product and our hotel accommodation through traditional and online tour operators. When we add VAT to the price, its passed on to the visitor, making us a much less competitive destination,” Nascimento explained.
He pointed out that according to Miller, “Competition for tourism market share has increasingly become linked to competition for investment, especially foreign direct investment. Successful tourism development therefore requires focus on attracting visitors as well as attracting investment for the development of tourism products, including visitor accommodation, transport and amenities.”
Pointing to Miller’s observation as it relates to a 2013 World Bank Assessment of Guyana’s ranking for ease of doing business in a range of investment activities, Nascimento quoted the author as saying, “The most significant finding was that in five of the 10 indicators measured, Guyana ranked in the bottom half of the 185 countries surveyed.
Boasting about some of Guyana’s achievements in the Tourism and Hospitality industry, Nascimento reflected that much of what Guyana has to offer is comparable, and in some cases, better than much of what many other Caribbean countries have to offer.
“There is no doubt in my mind that our tourism destinations, mainly centered in the North Rupununi, the Essequibo River within the Bartica triangle at the confluence of the Essequibo, Mazaruni and Cuyuni Rivers, and to a lesser extent on the Essequibo Coast and the Pomeroon and Berbice Rivers, are comparable and, in some instances, better than those offered in the Caribbean islands, Costa Rica, Venezuela and North Eastern Brazil,” Nascimento emphasized.
He highlighted however, that within recent months, the Guyana Government has engaged at least four consultancies directed at developing the tourism product. These include proposals to develop a training programme for Eco-Tourism’, ‘an investment guide for Guyana’s tourism’, ‘a study for developing the Cheddi Jagan International Airport as an aviation hub for the Caribbean into South America’, and ‘a study about to commence on Branding Guyana’s Tourism Product.
“We also recommend that tourism and aviation are combined since, especially in Guyana they completely complement each other,” Nascimento said.
He added, “Our other recommendation, in support of the Aircraft Owners Association, is that we expand our hinterland airstrips to accommodate larger, 20 or 30 seat aircraft, to increase airlift and bring down cost.”
Nascimento said that THAG had hoped also, that the proposal for a National Aviation Policy and Plan, approved by the National Competitiveness Council, would have been reflected in the Budget, in particular, in moving Guyana to Category 1 recognition.
Meanwhile, Nascimento highlighted that THAG has developed an excellent working relationship with the Minister of Tourism (Ag) Irfaan Ali.
Nascimento advocated that Ali must be given the legislative and financial support to move the Tourism industry forward, and should therefore be confirmed as Minister of Tourism.
Nonetheless, in closing, the THAG President said that Guyanese have every reason to be proud of the local product and congratulate the people who have, over the past 20 years or more, taken the risk to building these (tourism) products.
Some of them founded and have today, become members of THAG. These include, Vice President, Nicole Correia, Executive Director, Treina Butts, along with Members of the Board, Andrea de Caires, Jacqueline Allicock, Mitra Ramkumar, Colin Edwards, Ann Hamilton, and Daniel Gajie – the past president. THAG’s Executive Officer is Oslyn Martindale.