The Committee for Financial Supervision CFT has urged Curaçao to develop a structural policy for Airbnb and similar online platforms. Their recommendation highlights the importance of including short-term vacation rentals in government's hospitality industry strategy.
In St. Maarten, Minister of Tourism, Economic Affairs, Transport and Telecommunication (TEATT) Grisha Heyliger-Marten recently confirmed (see last Thursday’s newspaper) that accommodation owners who approach the Tax Office to pay taxes on related earnings are being told there is no legal basis for such. Payments can only be made if they establish a company through which the income can be received and the regular turnover tax paid.
She said government is working to amend the law to establish a clear legal basis for taxing foreign-owned rentals. Those involved often don’t appear in the country’s Tax Registry and lack a so-called CRIB number to pay local taxes.
According to her, the amendment was sent to Legal Affairs, but the process has been held up because the Finance Department must also provide input. After that the bill will proceed through the standard legislative process via the Council of Advice and the Social Economic Council SER, before eventually going to Parliament.
However, at least four consecutive governments have attempted to tax short-term vacation rentals before, so far with little success. The current draft legislation must create a statutory basis to enter into collection agreements with providers like Airbnb, Expedia, VBRO and others.
Meanwhile, this so-called “home sharing” sector continues to unfairly compete with local hotels and resorts expected to be fiscally compliant. There is a growing and some would say urgent need to level that playing field.
Finance Minister Marinka Gumbs had earlier reported receiving assistance from the International Monetary Fund (IMF) and Caribbean Regional Technical Assistance Centre Cartac in this matter. Based on their advice, it is now part of the Tax Transformation Programme reforms.
After all these years, to most people exactly how probably seems less important than when. What they are really looking for at this point is a clear timeline.
