Lower VAT rate mulled for tourism sector –Minister says Guyana to be rebranded, aggressively marketed abroad
Telecommunications Minister Cathy Hughes
Telecommunications Minister Cathy Hughes

WITH the tourism sector being one of the fastest growing industries worldwide, Guyana is looking to burnish and enhance its image as a prime tourism destination.But locals will not be neglected in the process as the Ministry of Tourism intends to make the local tourism product accessible and affordable to all.
And as obtains in some Caribbean countries, Tourism Minister Cathy Hughes will be pushing for a lower VAT rate for the tourism sector as against the standard 16 per cent rate the Government charges through the Guyana Revenue Authority (GRA).

 Local airport taxi drivers must be able to tell of the wonders of Kaieteur Falls, says Tourism Minister Hughes
Local airport taxi drivers must be able to tell of the wonders of Kaieteur Falls, says Tourism Minister Hughes

In The Bahamas, the standard VAT rate is 15 per cent, but the rate applied in its tourism sector is 10 per cent; in Barbados the VAT rate in 17.5 per cent but its tourism sector enjoys a concessionary rate of 7.5 per cent.
Similarly, Dominica has a VAT rate of 15 per cent but it is reduced to 10 per cent for its tourism sector.
“We need to be able to provide incentives to spur the local industry,” said Minister Hughes, who has more than 20 years of experience in the tourism industry.
In an exclusive interview with the Guyana Chronicle, Hughes said she is also bothered about the state of small hoteliers, who are local operators, some of whom have been in the business for 20 to 25 years.
Hughes understood well the plight of the small operators, having been the owner of a small boutique hotel.
“If you have a 15-room hotel, you were not entitled to duty-free on your towels, your sheets, your linen and so many other things. I thought not enough incentive was put in place for small operators in the industry,” she said, pointing out that it is one of the issues she will be looking to address.
LOCALLY-OWNED BUSINESSES
Guyana can celebrate the fact that its tourism industry comprises many locally-owned businesses. However, in other destinations, many of the investors are foreigners and there have been complaints that a lot of the money is taken out of those countries. This does not obtain in Guyana.
AN ADVANTAGE
“So it is like we are starting with an advantage because we have a high level of local investment and we want to be able to raise the bar in terms of services and products we provide,” Minister Hughes said.
She also said that tourism has to be recognised as an export industry and attention will be paid to costs as it relates to taxes.
The cost for a trip to Kaieteur Falls is between US$150-US$200. This is not too affordable to ordinary Guyanese. But the high cost is reportedly due to the high tax on aviation fuel.
“It is a challenge because when a trip to Kaieteur is beyond the reach of the average Guyanese, then you are saying that not many of the local people can enjoy our tourism product,” the Minister said, adding that it is a setback to word-of-mouth promotion of the country’s tourism products, which is a very effective means of selling Guyana.
She added: “We want our taxi drives to tell visitors when they arrive at our airports that the Kaieteur Falls is a must-see before they leave Guyana. They must say I’ve been there and it is a breathtaking, life-changing experience.”
The unaffordable cost to ordinary Guyanese to visit local tourist attractions and a reduction of the VAT rate for the tourism sector, Minister Hughes said, are issues she wants to address and change.

MARKETING GUYANA
But these are not all. She believes that Guyana has not been able to put ‘Destination Guyana’ out into the regional and international markets.
Traditionally, Guyana’s target market has been the diaspora. And the minister is of the firm view that given the local investment in tourism and the fact that there are hotels, resorts, tour companies and other services that go with tourism, more emphasis has to be placed on attracting more people to Guyana, and to promote Guyana more aggressively around the world.
“We still have a scenario where in many parts of the world, people do not know that Guyana exists. They think Guyana is Ghana. We have long past stereotypes that relate to the Jonestown situation, and more recently and very worrying, there is a concept of Guyana which is a bit unfair.
“We have challenges with some of our Caribbean neighbours with some of us being perceived as people who go to other people’s country looking for work and overstaying their time and they don’t get treated well,” she noted. This is coupled with the perception that Guyana is not a safe place.
“We need to do a marketing programme, we need to revise strategically and carefully, design a programme that addresses all of those issues that I mentioned with a view to creating a new vision of what Guyana is; what we can offer a potential visitor and correct the negatives that seem to be out there.”

By Tajeram Mohabir

 

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