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Minister of Finance, Camillo Gonsalves. (iWN photo)
Minister of Finance, Camillo Gonsalves. (iWN photo)
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Minister of Finance, Camillo Gonsalves has instructed the Inland Revenue Department to liaise with Airbnb to collect the US$3 per night climate levy on tourism accommodation, which came into effect on Oct. 1

He said hotels had complained that they are paying income tax, fees, and processing the climate tax, while people were building homes, claiming they live in them but were renting them out, via Airbnb, for short term stay.

Airbnb, Inc is a privately held global company headquartered in San Francisco, United States. It operates an online marketplace and hospitality service that is accessible via its websites and mobile apps. Members can use the service to arrange or offer lodging, primarily homestays, or tourism experiences.

Gonsalves said that as of September, there were 86 hotels registered for the levy, representing the majority of hotels in SVG.

However, Airbnb apartments listed for rent ranged from studios to one bedroom to 16-bedroom facilities, representing 634 rooms in SVG.

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The minister said this is “a lot of rooms in our context,” adding that the average price was US$145 per night.

In St. Vincent, the price is quite cheaper, at US$75 per night, while in Bequia it is US$225, with the highest in Bequia being US$1,142 per night.

“It’s only fair if you are charging this type of money to visitors coming to St. Vincent and the Grenadines that you pay your fair share.”

He said that it has been true in the past that sometimes these numbers are so small that it is difficult for the tax collector to pursue them.

“If you have a one-bedroom, if you are renting two bedrooms and they are only occupied half the time, the effort to collect that money is not insignificant.

“But, I think that the hoteliers have a legitimate point that if there are 634 rooms out there listed for rent in St. Vincent and the Grenadines at an average of almost 150 US [dollars], per night, they should be asked to pay their fair share.”

The minister said he has given the necessary instruction to the Inland Revenue Department, which is in touch with Airbnb.

“And what we are going to do is to get Airbnb to apply the taxes on their end so that we can collect them.

“Six hundred and thirty-four rooms, $150 a night, if you have 25 per cent occupancy, that’s over $8 million in revenue. It’s not an insignificant amount of money and so we are currently negotiating with Airbnb itself about how they can apply the taxes.”

He said there are some complications that have to be sorted out but that is the direction in which his government is going.

The minister said he did not see Airbnb outfits as a threat to traditional visitor accommodation providers and the revenue stream they generate.

“I think this is precisely the type of entrepreneurship that we want to encourage in taking advantage of the opportunities that increased tourism provides.”

He said SVG is receiving a lot of new visitors. Some of them don’t want to stay in a hotel.

“They want to stay in an inn, in somebody’s house, in something that feels cosy. And I applaud the entrepreneurs that have made their homes available and have taken advantage of it.”

He said when airlines inquire about the number of rooms in SVG, officials can cite the number of in addition to those being offered via Airbnb.

“That’s another 600 rooms and you should take that into account when you are thinking of the room stock in St. Vincent and the Grenadines. So we don’t see it as a threat — but the only threat is if there is one class of accommodation provider that’s not paying taxes or not paying the required fees and there is another class that is.

“And that is unfair to the people who are paying. So we are trying to level that playing field, but Airbnb, as technology, as entrepreneurship, I don’t see it as a threat,” Gonsalves said.

8 replies on “Minister instructs taxman to collect levy from Airbnb operators”

  1. What is going on with this Minister, the Government and taxation? Let the people live. Before you start to tax the people you must allow them an opportunity to get a proper footing into their respective businesses. You give all the white expatriots unsormoubtable tax incentives to invest but treat your own people like rubbish.

    There are more important matters to deal with at this stage in our country. Fix the unemployment rate, eliminatee income tax, fix the high levels of violent crimes, make the police force more effective and efficient and establish an integrity commission with the necessary legislation to prevent corruption among public officers.

    These are more important matters than to burden the people with taxes. You are taxing poor people into poverty and this country have now tax itself out of the Regional tourist market. We need a proper justifiable tax structure.

    There are too many unnecessary taxes in SVG. In some cases the taxes are too high. Vincentians should be getting free medical care with the amount of taxes that is being charged. I am almost certain this country have twenty (20) different taxes or more. Is this a democratic or socialist state?

  2. This government is so wicked and unfair to the owners of those establishments. They already paid VAT on the construction materials paid NIS for the people employed during construction. Then they have to pay property taxes along with income tax. Yet they want to collect more and the minister talking about paying their fair share? What has to government contributed to assist the owners to make it fair? Nuff said

  3. What I do not understand is why two people staying in the same room need to pay $3US each per night. Base on my knowledge the max people sharing a room should be two, I can understand if its more than two people, the hotels will have the right to charge an extra fee. I have visited many hotels for example in Las Vegas, you do have to pay a fee, but its per room per night not per person. The rooms there are also cheaper so the extra fees are much higher base on where you stay. Hotels in SVG are not cheap, staying at a decent hotel can cost $170+ CND per night, so if you are reading this don’t just look at the $3US per night per person but also factor in the high cost of a hotel stay. Don’t get me wrong, I really do not mind paying $3USD per night, I’m just having a hard time understanding why its per person if its just two people sharing the same room.I know that the hotels have no choice but to impose this cost to their guest, but it can hinder their growth which can in turn cause the lost of employments.

  4. Ricardo Francis says:

    I take it your instructions, DOES NOT include the Grenadines, and more specifically Mustique. When was the last time the home owners in Mustique paid any form of taxes ? You are climbing a very steep slope. .

    Remember, Mustique is Vincentians REAL Property.

    Vincentians are tired of all the bull crap. The ULP and your Papa can continue to squeeze but I do not quit.

    Ricardo Francis, Prime Minister of St. Vincent and the Grenadines in Waiting and in the Making.

  5. I cannot phantom why Vincentians complain about taxes at home but easily adapts to taxes in another country. It’s quite perplexing.

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