Tuesday, 13 October 2020
Financial Resolution No. 3: Value Added Tax
It is fair to say that the hospitality sector has faced an economic tsunami. Everything and anything that can be done to support bars, restaurants and hotels should be done. Obviously I support this VAT reduction which we called for in our alternative July stimulus and our alternative budget. The Government went for what can only be described as a discredited stay and spend initiative, which unfortunately has not worked. It also cut the 23% rate, which has not been enough for the hospitality sector. The Government also cut the wage subsidy scheme, especially for low-paid workers, many of whom are in the hospitality sector. It has not done enough in terms of providing direct grants towards the fixed costs associated with hotels, bars and restaurants. The tsunami facing the sector is very serious and the situation will remain the same for some time to come because of the restrictions.