Tourism businessman Rafael Blanco Canto, a former president of the National Hotel & Restaurant Association has said that the Dominican Republic has lost its competitiveness in the Caribbean tourism market and is beginning to confront difficulties due to increasing operational costs. He said that the reasons behind the increases in costs is the 26% appreciation of the Dominican peso, wage increases of up to 70%, and the increase in the cost of electricity, an average of 60%. The vice president of the Viva Wyndham Resorts says that the hotel sector is urging that the ITBIS (VAT) tax be set lower for the tourism industry than for other sectors. He mentioned, as reported in the Listin Diario, that in Mexico there is a 15% rate of general ITBIS and a 10% for the tourism state of Quintana Roo where Cancun, Riviera Maya and Cozumel are located. He says that likewise, Jamaica has a general 15% VAT and it applies 5.9% to the tourism sector. In the Bahamas, he says there is a general VAT rate of 6%, which is just 2.4% in the tourism sector.
Meanwhile, the president of the tourism commission of the Chamber of Deputies, Francisco Soliman (PRD-La Altagracia) said that they would consolidate the support of provinces where there is a strong tourism presence to promote an alliance for legislation aimed at strengthening the development of the tourism industry. As reported in Hoy newspaper, he said that the provinces that benefit directly from tourism are seeking that the fiscal reform ensures competitiveness and creates the necessary conditions so that the sector can continue to be strong and grow. He favored the introduction of a reduced VAT rate for the tourism sector. “If we do not recognize that tourism needs fiscal parity with other countries, then the impact of the loss of competitiveness will be felt in a loss of jobs, less investment and other sectors of the economy will be affected, particularly the farming sector that will lose its main market, and industry, that will also be affected by the decline in hard currency,” he stated.