PM to meet with tourism body over proposed GCT increase

WESTERN BUREAU:

Prime Minister Dr Andrew Holness is to meet leaders of the tourism industry next week after the Jamaica Hotel and Tourist Association (JHTA) intensified its opposition to the proposed increase in general consumption tax (GCT) on tourism activities.

JHTA President Christopher Jarrett told the association's 65th annual general meeting on Saturday, at Sandals Dunn’s River in Ocho Rios, St Ann, that the organisation had been seeking discussions with the Government since March and would meet Holness on July 2, to present its concerns about the planned tax measure.

While stressing that the association supports responsible fiscal management and recognises the financial pressures facing the country following Hurricane Melissa, Jarrett said tourism operators could not support the proposed increase because many hotels and attractions were locked into contracts negotiated years in advance.

"The Jamaica Hotel and Tourist Association cannot support the proposed increase in general consumption tax on tourism activities, not because we oppose taxation but because we believe there is a better path."

The Government has proposed increasing the GCT on specified tourism activities from 10 per cent to the standard 15 per cent rate, by April 1 next year. The measure, announced as part of this year's revenue package, is projected to generate an additional J$11.4 billion annually and is to be phased in over two years. 

Jarrett argued that additional taxation could not always be passed on to visitors because many contractual arrangements extend into 2027 and beyond. Instead, operators would be forced to absorb the additional costs, affecting profitability, future investment, employment and Jamaica's competitiveness against rival destinations.

He said the association's position was not one of confrontation but of consultation, maintaining that policies affecting the country's largest foreign exchange-earning industry should be shaped through meaningful dialogue with stakeholders.

Jarrett said the JHTA would present economic evidence to the prime minister and argue for an alternative approach that protects the Government's fiscal objectives while safeguarding investment, jobs and the competitiveness of Jamaica's tourism industry.

janet.silvera@gleanerjm.com