Today’s question hour in Parliament (see related story) with Minister of Finance Marinka Gumbs (DP) on tax holidays could prove quite interesting. It comes as a result of enquiries by MP Francisco Lacroes (UP) on the application and extension of such under the “Landsverordening ter Bevordering van Bedrijfsvestiging en Hotelbouw” (LBBH) and the broader framework of fiscal incentives. The plenary session is open to the public and will be broadcast live.
For some time now, there has been concern about the continued value of offering tax holidays to establish and build hotels. For one thing, the impression exists that regular tax payments by those involved don’t always start when the grace period ends and sometimes remain lacking for years.
Another issue is that projects are sometimes announced as resorts, but turn out to be residential complexes, including vacation homes. The latter still helps bring visitors to the island, but it’s a bit different from a full-fledged hotel with all related services and personnel providing such.
What government should show, for example, is the number of companies that became and stayed fiscally compliant after their tax holiday ended or did not do so. People also want to know how many related ventures are actually successful hotels today.
The idea here is not to discourage incentives that boost the local tourism economy and create jobs, but rather to measure their effectiveness. It’s also important to ensure these are published and used as intended, in a transparent and fair manner.
