St Lucia tourism minister defends VAT

This was the message sent by Tourism minister Lorne Theophilus in his first address to the wider membership of the Saint Lucia Hotel and Tourism Association at their recent 48th annual general meeting at the Royal by Rex Resort.

Theophilus defended the new value added tax (VAT) to be implemented by the Kenny Anthony administration in September this year. 

“The role of hoteliers in the introduction of the Value Added Tax is an important one,” the tourism minister said. “Government had examined the implications for the industry on introducing VAT and is convinced that a VAT of eight percent is a fair tax. Notwithstanding, the measure will be reviewed by April 2013 to access the actual effects of VAT on the sector.”

“Coping with the changed requires trust in each other, patience and innovation,” he went on. “It is my view that the best days of the industry are ahead of it. I call on all to work together as we seek to reshape this vital industry and business.”

While addressing the meeting, which took place under the theme “A Hand in Hand Partnership; Now More Than Ever We Need Each Other”, Theophilus reported a 15 percent increase in arrivals to the island throughout the months of January to March, when compared with a similar period in 2011. That he said was a combined effort of hotelier and the St Lucia Tourist Board.

“2012 has the potential to be a very good year, but there are the challenges we must overcome,” Theophilus commented.

Firstly, he said there was need to remain focused on the agreed marketing strategy in all major markets. A decision had been made that the primary focus would be on the romance market, with family and the soft market secondary.“All the evidence suggests that the romance market is very resilient and this fits nicely with the strong reputation St Lucia has developed over time in this market segment,” the minister said.

Secondly, improvement was necessary when it came to airlift, particularly from the US market. “The current prices to St Lucia on any of our major carriers from the US is simply too high,” he stated. “This undoubtedly is negatively impacting demand and hence the performance so far.”

The third area the tourism minister focused on was the brand awareness of St Lucia that he said was “currently high and positive in the marketplace.” However, the minister felt a new tagline for marketing promotions that was all embracing and reflective of the destination needed to be developed.

He added that the time had come for concerted effort to be made in identifying and developing new markets, and that greater attention would be paid to emerging markets such as Brazil and Russia, which was linked to Cabinet’s decision to remove visa requirements for Russians wishing to travel to St Lucia. He also said Canada was a source market that deserved careful attention.

Theophilus said EC$45 million had been allocated to the St Lucia Tourist Board for marketing activities, while $5 million had been devoted to product development.

“All our marketing efforts will be in vein if the product we are promising is found wanting,” he said. “The need to concentrate on product development is central to the success of the industry. This is why the ministry of tourism will be paying special attention on the introduction of standards throughout the industry and the commencement of a process of licensing. The tourism sector is far too important to allow a few to dominate all sectors of the industry while the rest of the domestic population are reduced to mere spectators or do not feel that they have a stake in the industry and hence a reason to fight to protect it.”

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